Arthur Company Had the Following Data for the Year Just

Arthur Company had the following data for the year just ended:
$\begin{array}{|l|r|}\hline \text { Sales } & 4,000 \text { units } \\\hline \text { Sales price } & \$ 60 \text { per unit } \\\hline \text { Variable cost } & \$ 18 \text { per unit } \\\hline \text { Fixed costs } & \$ 42,000 \\\hline\end{array}$


-If the company's fixed costs decrease by 20% next year,all other factors remaining the same,by how much will the break-even level change compared to that of the current year,rounded to the nearest whole unit?

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

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free