Level of sales in units required to achieve

Question

Problem:

New Insights, Inc. is looking to achieve a net income of 15 percent of sales. Here's the firm's profile: Unit sales price is $10; variable cost per unit is $6; total fixed costs are $40,000.

Required:

Question: What is the level of sales in units required to achieve a net income of 15 percent of sales?

1. 12,000 units
2. 21,000 units
3. 16,000 units
4. 20,000 units

Note: Show supporting computations in good form.