Question

All I’m Saying Corporation produces and sells a single product. Data concerning that product appear below: Selling price per unit $ 170.00 Variable expenses per unit $ 81.10 Fixed expense per month $ 997,920 The unit sales to attain the company's monthly target profit of $137,240 is closest to: (Round your intermediate calculations to 2 decimal places.)
a. 6,578
b. 12,769
c. 14,341
d. 7,896

Answer 1

Answer:

Break-even point in units= 12,769 units

Explanation:

Giving the following information:

Selling price per unit= $170

Variable expenses per unit= $81.10

Fixed expense per month= $997,920

Monthly target profit of $137,240

To determine the number of units to be sold, we need to use the break-even point in units formula. We need to add the desired profit.

Break-even point in units= (fixed costs + desired profit) / contribution margin per unit

Break-even point in units= (997,920 + 137,240) / (170 - 81.1)

Break-even point in units= 12,769 units