Flying Cloud Co. has the following operating data for its manufacturing operations: Unit selling price $233 Unit variable cost $101 Total fixed costs $795,000 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 next break-even point for Flying Cloud Co. will be a.increased by 912 units b.decreased by 760 units c.increased by 608 units d.increased by 760 units
Flying Cloud Co. has the following operating data for its manufacturing operations: Unit selling price $233 Unit variable cost $101 Total fixed costs $795,000 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 next break-even point for Flying Cloud Co. will be a.increased by 912 units b.decreased by 760 units c.increased by 608 units d.increased by 760 units
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Flying Cloud Co. has the following operating data for its manufacturing operations:
| Unit selling price | $233 |
| Unit variable cost | $101 |
| Total fixed costs | $795,000 |
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 next break-even point for Flying Cloud Co. will be
a.increased by 912 units
b.decreased by 760 units
c.increased by 608 units
d.increased by 760 units
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