Indifferent between modifying the product


Food Company is considering a modification to one of its main products next year that would make it more attractive to customers. As a result, Food Company could increase the selling price by $2.96. However, fixed costs would increase to $15,390.Financial information for the product for this year is as follows:

Selling price:          $10.34

Variable costs:       $3.30

Fixed costs:           $10,600
At what unit sales level would Food Company be indifferent between modifying the product and not modifying it?

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Accounting Basics: Indifferent between modifying the product
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