Pittsboro corporation produces and sells a single product. data for that product are: sales price per unit $590 variable cost per unit $190 fixed expenses for the month $1,200,000 currently selling 4000 unitsmanagement is discussing increasing the price to $625 to cover an increase in fixed expenses of $89,000. management believes they might lose 2% of sales per month. how many units per month would the company have to sell to maintain its current level of operating income?

The company will need to sale 3,883 units to maintain its current operating income of 400,000

Explanation:

We will calculate the point at which the company mantains his current income in units at the new scenario:

Where:

625 - 190 = 435 each units contributes this amount to afford the fixed cost and make a gain.

Current income: contribution x units sold - fixed cost

                             (590-190) x 4,000 - 1,200,000 = 400,000

(1,200,000 + 89,000 + 400,000) / 435 = 3,882.75862 = 3,883 units

The company will need to sale 3,883 units to maintain its current operating income of 400,000

urban company reports the following information regarding its production cost: units produced 37,000 units direct labor $ 30 per unit direct materials $ 35 per unit variable overhead $ 237,000 in total fixed overhead $ 127,000 in total

3rd the reason why is because of management and leadership