Woodley Corporation management has budgeted the following amounts for its next fiscal year:

Total fixed expenses	$500,000
Sale price per unit	$1,000
Variable expenses per unit	$600

Requirements:

1. If Woodley Corporation can reduce fixed expenses by $20,000, how will break-even sales in units be affected?

2. If Woodley Corporation spends an additional $15,000 on advertising, sales volume should increase by 1,000 units. What effect will this have on operating income?

3. If Woodley Corporation can reduce fixed expenses by $50,000, by how much can variable expenses per unit increase and still allow the company to maintain the original break-even sales in units?

4. If fixed expenses increase by 20%, to maintain the original break-even sales in units, what would be the sale price per unit have to be?