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Sheridan Company incurred the following costs to produce 100000 units: Variable...

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Accounting

Sheridan Company incurred the following costs to produce 100000 units:
Variable costs $420000
Fixed costs ,840000
An outside supplier is interested in producing the item for Sheridan. If the item is produced outside, Sheridan could use the released production facilities to make another item that would generate $160000 of net income. No fixed costs are avoidable. At what unit price would Sheridan accept the outside supplier's offer if Sheridan wanted to increase net income by $120000?
$3.80
$7.00
$4.60
$5.80
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