Reference: 08-06
Arthur Company Had the Following Data for the Year

Reference: 08-06
Arthur Company had the following data for the year just ended: $$\begin{array} { | l | l | } \hline \text { Sales } & 4,000 \text { units } \\\hline \text { Sales price } & \$ 60 \text { per unit } \\\hline \text { Variable cost } & \$ 18 \text { per unit } \\\hline \text { Fixed costs } & \$ 42,000 \\\hline\end{array}$$
-If the company's fixed costs decrease by 20% next year, all other factors remaining the same, the break-even level will change from that of the current year by (rounded your final answer to the nearest whole unit) :

A) 200 unit decrease.
B) no change in the break-even point in units.
C) 200 unit increase.
D) 440 unit decrease.

Correct Answer:

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