Boise Inc manufactures and sells two models of luxuriously finished cutlery : Alvaro and Bazan. Current revenue, costs, and unit sales date for the two products appear below:
Avano : selling price per unit : 4.00 variable expenses per unit : $2.40 number of units sold monthly : 200 Fixed Expenses per month : $660
Bazan : selling price per unit : 6.00 variable expenses per unit : $1.20 number of units sold monthly: 80 Fixed Expenses per month : $660
The company has developed another product, Cano, which the company plants to sell for $8 per month. At this price, the company expects to sell 40 units per month without affecting the sales or Alvaro or Bazan. The variable expense would be $6 per unit. The company’s fixed expenses would not change. How many units of Alvaro must the company sell in order to break even? Assume that the sales mix would stay the same.