Last year, Flynn Company reported a profit of $57,000 when sales totaled $507,000 and the contribution margin ratio was 40%. If fixed expenses increase by $8,700 next year, what amount of sales will be necessary in order for the company to earn a profit of $67,000? (Do not round intermediate calculations.)

→	$553,750
	$542,350
	$574,000
	$593,800

Profit = (CM ratio × Sales) − Fixed expenses

$57,000 = (0.40 × $507,000) − Fixed expenses

Fixed expenses = (0.40 × $507,000) − $57,000

Fixed expenses = $202,800 − $57,000

Fixed expenses = $145,800

Dollar sales to attain a target profit = (Target profit + Fixed expenses) ÷ CM ratio

= ($67,000 + $145,800 + $8,700) ÷ 0.40

= $221,500 ÷ 0.40

= $553,750