Spencer Tools Would Like to Offer a Special Product to Its

Multiple Choice

Spencer Tools would like to offer a special product to its best customers.However,the firm wants to limit its maximum potential loss on this product to the firm's initial investment in the project.The fixed costs are estimated at $21,000,the depreciation expense is $11,000,and the contribution margin per unit is $12.50.What is the minimum number of units the firm should pre-sell to ensure its potential loss does not exceed the desired level?

A) 1,220 units
B) 1,680 units
C) 2,215 units
D) 2,560 units
E) 2,750 units