Zachary Company reported the following data regarding the product it sells:
Sales price $48
Contribution margin ratio 25%
Fixed costs $336,000
Required
Use the contribution margin ratio approach and consider each requirement separately.
A. To obtain a profit of $48,000, what must the sales be in dollars? In units?
B. If the sales price increases to $60 and variable costs do not change, what is the new break-even point in dollars? In units?