Reference: 08-11
Hurst Co -In the Current Year, the Company Sold 43,000 Units

Reference: 08-11
Hurst Co. manufactures and sells a single product. Price and cost data regarding this product are as follows: $$\begin{array} { | l | l | } \hline \text { Selling price } & \$ 40 \text { per unit } \\\hline \text { Variable manufacturing costs } & \$ 20 \text { per unit } \\\hline \text { Variable selling \& admin. expenses } & \$ 6 \text { per unit } \\\hline \text { Fixed manufacturing overhead } & \$ 208,000 \text { per year } \\\hline \text { Fixed selling \& admin. expenses } & \$ 324,000 \text { per year } \\\hline\end{array}$$
-In the current year, the company sold 43,000 units. Due to competition, management will be forced to lower the selling price by 10% next year. How many units must be sold next year to earn the same income as was earned in the current year?

A) 58,800 units.
B) 60,200 units.
C) 53,200 units.
D) 50,000 units.

Correct Answer:

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