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Riley Company produces and sells a product that has variable product costs...

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Question

Accounting

Riley Company produces and sells a product that has variable product costs of $31 per unit and a selling price of $95 per unit. Its current sales total $294,500 per month. Fixed manufacturing costs total
$44,000 per month and fixed selling and administrative costs total $55,000 per month. Variable selling and administrative costs are $9 per unit. The company is considering a proposal that will increase the
selling price by 10%, increase the fixed manufacturing costs by 10%, and increase the fixed selling and administrative costs by $1,500.
Required:
Compute the company's current break-even point in units.
Compute the company's current margin of safety in dollars.
Compute the break-even point in units assuming the proposal is accepted.
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