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Question - Flying Cloud Co. has the following operating data for its manufacturing operations:
Unit selling price $231
Unit variable cost $105
Total fixed costs $800,000
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, what the next break-even point for Flying Cloud Co.?
a. increased by 683 units
b. increased by 854 units
c. decreased by 854 units
d. increased by 1,025 units
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