Oscar Incorporated currently sells its products for $400 per unit

Accounting Feb 23, 2021

Oscar Incorporated currently sells its products for $400 per unit. Management is contemplating a 10% increase in the selling price for the next year. Variable costs are currently 20% of sales revenue and are not expected to change next year. Fixed expenses are $140,000 per year.

If fixed costs were to decrease 10% during the current year and the new selling price goes into effect, how many units will need to be sold to breakeven?

A) 1,283 units

B) 296 units

C) 350 units

D) 154,000 units

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