Foggy Co Has the Following Operating Data for Its Manufacturing Operations

question 64

Multiple Choice

Foggy Co. has the following operating data for its manufacturing operations: $\begin{array}{ll}\$ 250 & \text { Unit selling price } \\\$ 100 & \text { Unit variable cost } \\\$ 840,000 & \text { Total fixed costs }\end{array}$ The company has decided to increase the wages of hourly workers, which will increase the unit variable cost by 10%. Increases in the salaries of factory supervisors and property taxes for the factory will increase fixed costs by 4%. If sales prices are held constant, the break-even point for Foggy Co. will:

• A) increase by 400 units.
• B) increase by 640 units.
• C) decrease by 640 units.
• D) increase by 800 units.

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