To solve for units sold at an income of $200,000:
First, I would subtract the variable cost of $8 from the unit sales price of $18 dollars which gives you $10.
Unit profit = $10
Fixed costs = $200,000
How many units need to be sold to earn an income of $200,000?
40,000 units x $10 = $400,000 - $200,000 = $200,000
40,000 units need to be sold to earn an income of $200,000.
Answer:
None of the given options.
Depreciation expense for year 1 would be $37,500.
Explanation:
Cost = $400,000
Residual value = $50,000
Expected hours = 40,000
Working hours (year 1) = 6,000 hours
Now,
Depreciation per hour =
Depreciation per hour =
Depreciation per hour =
Depreciation per hour = $6.25
Depreciation expense (year 1) = Depreciation per hour × Working hours (year 1)
Depreciation expense (year 1) = $6.25 × 6,000
Depreciation expense (year 1) = $37,500
Increases and supply does not change, when demand does not change and supply increases.