Required sales for $4,000 profit increase Steps:

• Original contribution = 40% × $40,000 =$16,000
• Original profit = $16,000 −$1,400 = $14,600
• Target profit = $14,600 +$4,000 = $18,600
• Required contribution = $18,600 +$1,400 = $20,000
• Required sales = $20,000 ÷ 0.40 =$50,000 Why D is correct:
• $50,000 is the sales revenue yielding a$4,000 profit increase via the formula: Required sales = (fixed costs + target profit) / contribution margin ratio Why the others are wrong:
• A: Equals new contribution if sales rose to $90,000, ignoring target profit
• B: Matches sales for $14,000 profit increase ($30,000 contribution needed)
• C: Matches sales for $16,000 profit increase ($34,000 contribution needed)

Final answer: D