## To find the break-even point in units, you need to determine how many units need to be sold in order to cover the fixed costs of $40,000.

The formula to calculate the break-even point is:

Break-even point (in units) = Fixed costs / (Price per unit - Variable cost per unit)

In this case, the fixed costs are $40,000, the price per unit is $2, and the variable cost per unit is $1.20.

Break-even point = $40,000 / ($2 - $1.20) = $40,000 / $0.80 = 50,000 units

Therefore, Chevy's Manufacturing needs to sell 50,000 units to cover their fixed costs and reach the break-even point.

Now let's calculate the net profit at 100,000 and 110,000 units.

Net profit is calculated as:

Net profit = (Price per unit - Variable cost per unit) x Number of units - Fixed costs

At 100,000 units:

Net profit = ($2 - $1.20) x 100,000 - $40,000

= $0.80 x 100,000 - $40,000

= $80,000 - $40,000

= $40,000

At 110,000 units:

Net profit = ($2 - $1.20) x 110,000 - $40,000

= $0.80 x 110,000 - $40,000

= $88,000 - $40,000

= $48,000

To calculate the percentage increase in profits, use the following formula:

Percentage increase in profits = (New profit - Old profit) / Old profit * 100

Percentage increase in profits = ($48,000 - $40,000) / $40,000 * 100

= $8,000 / $40,000 * 100

= 0.2 * 100

= 20%

Therefore, with the increase in volume from 100,000 units to 110,000 units, Chevy's Manufacturing would see a 20% increase in profits.