Boggess Corporation manufactures numerous products, one of which is called Alpha-41. The company has provided the following data about this product: Assume that the total traceable fixed expense does not change. How many units of product Alpha-41 would Boggess need to sell at a price of $94.60 to earn the same net operating income that it currently earns at a price of $86.00? (Round your answer up to the nearest whole number.)
A) 96,000
B) 92,554
C) 83,777
D) 108,621

Question

Boggess Corporation manufactures numerous products, one of which is called Alpha-41. The company has provided the following data about this product:  Assume that the total traceable fixed expense does not change. How many units of product Alpha-41 would Boggess need to sell at a price of $94.60 to earn the same net operating income that it currently earns at a price of $86.00? (Round your answer up to the nearest whole number.)
A) 96,000 
B) 92,554 
C) 83,777 
D) 108,621

Quizplus · Accepted Answer

Profit = (P − V) × Q − Fixed expenses
$330,000 = ($94.60 per unit − $57.00 per unit) × Q − $3,150,000
$3,480,000 = ($94.60 per unit − $57.00 per unit) × Q
$3,480,000 = ($37.60 per unit) × Q
Q = $3,480,000 ÷ $37.60 per unit = 92,554 units (rounded up)

Boggess Corporation Manufactures Numerous Products, One of Which Is Called