The additional number of units babymart needs to sell to maintain the same level of income is 25 units.
The fixed cost = $50,000 - $5,000 = $45,000
- The total revenue = $315
- The variable cost = $115
- Let X represents the additional number of unit
<h2>Further Explanation</h2>
Therefore,
- The total revenue = $115 × x
- The variable cost = $ 315 × X
To determine the Net income, we have to subtract the total revenues from the total expenses. This can be expressed as:
Net income = Total revenue – Total expenses
If we substitute the above value, then we have
Recall, net income = 40,000, therefore we have:
40,000 = (315 × x) – 45,000 – (115X)
40,000 + 45,000 = (315 × X) (115 × X)
85,000 = (315x) – (115x)
85000 = 200X (divide both side by 200)
85,000 / 200 = 200X / 200
425 = X
X = 425
Therefore, we have to subtract the derived value from the monthly sale (400) cribs
Thus, 425 – 400
= 25.
Therefore, the additional number of units babymart needs to sell to maintain the same level of income is 25 units.
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- Babymart, inc. manufactures baby cribs and currently has fixed costs of $50,000 and a sales price per unit of $315. brainly.com/question/13665184
- Babymart, inc. manufactures baby cribs and currently has fixed costs of $50,000 and a sales price per unit of $315. brainly.com/question/13665184
KEYWORDS:
- babymart inc
- baby cribs
- variable cost
- total cost
- fixed costs
- raw materials