Question

Lin corporation has a single product whose selling price is $134 and whose variable expense is $67 per unit. the company's monthly fixed expense is $32,300. 2.value: 2.00 pointsrequired information required: 1. using the equation method, determine for the unit sales that are required to earn a target profit of $7,900. (round up your answer to the nearest whole number.)

Answer 1

Answer:

600 units

Explanation:

The computation of the units sales is shown below:

= (Fixed expenses + target profit) ÷ (Contribution margin per unit)

where,  

Contribution margin per unit = Selling price per unit - Variable expense per unit

= $134 per unit - $67 per unit

= $67 per unit

And, the other items values would remain the same

Now placing these values to the above formula  

So, the value would equal to

= ($32,300 + $7,900 ) ÷ ($67)

= ($40,200) ÷ ($67)

= 600 units