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XYZ Company produces a single product. In 2022, the selling price per unit of this product was $10/unit, and its variable costs were $9/unit. Its
XYZ Company produces a single product. In 2022, the selling price per unit of this product was $10/unit, and its variable costs were $9/unit. Its total fixed costs in 2022 were $80,000. In 2023, the variable cost of producing each unit of the product is expected to be the same as in 2022, but the demand for XYZs product is expected to rise considerably. To be precise, its selling price in 2023 is expected to rise so much that its 2023 contribution margin ratio is expected to be four times as high as its 2022 contribution margin ratio. The companys total fixed costs are expected to be the same in 2023 as in 2022. Presuming these expectations in 2023 are realized, what level of sales would XYZ have to achieve, in units, so that its 2023 direct costing income is one million dollars
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