Dirth Company Sells Only One Product at a Regular Price

question 4

Multiple Choice

Dirth Company sells only one product at a regular price of £7.50 per unit. Variable expenses are 60 percent of sales and fixed expenses are £30,000. Management has decided to decrease the selling price to £6.00 in hopes of increasing its volume of sales. What sales pound level is needed to obtain a before-tax profit of £60,000 when the selling price is £6.00 per unit?

• A) £360,000
• B) £120,000
• C) £72,000
• D) £90,000