A Company Has Variable Costs That Are 3/8 the Value

Multiple Choice

A company has variable costs that are 3/8 the value of their sales revenues. Total net income for the most recent period was a profit of $123 400 and sales were $400 000. The company has started a new marketing campaign that they hope will increase sales, but it will require additional advertising of $11 200. How many sales dollars does the company have to generate in order to remain at the same level of profitability as before the new ad campaign?

A) $358 933.33
B) $215 360.00
C) $400 000.00
D) $417 920.00
E) $696 533.33