Benson Company produces flash drives for computers which have variable costs of $10 per flash drive to produce. Each flash drive sells for $20 each. During the current month, 1,000 flash drives were sold. Fixed costs for the current month were $4,500. If variable costs increase by 10%, what happens to the breakeven level in units for the month for Benson Company?
A. It is 10% higher than the original breakeven point.
B. It increases by 50 units.
C. It depends on the number of units the company expects to produce and sell.
D. It is 10% lower than the original breakeven point.
Answer: B
If the answers is incorrect or not given, you can answer the above question in the comment box. If the answers is incorrect or not given, you can answer the above question in the comment box.