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bazaltina [42]
2 years ago
14

A company desires to sell a sufficient quantity of products to earn a profit of $280000. If the unit sales price is $16, unit va

riable cost is $12, and total fixed costs are $800000, how many units must be sold to earn net income of $280000?
Business
1 answer:
Alex Ar [27]2 years ago
7 0

Answer:

$270,000

Explanation:

Data provided

Quantity of products = $280,000

Total fixed costs = $800,000

Unit sales price = $16

Variable cost = $12

The computation of units must be sold is shown below:-

Contribution per unit = $16 - $12

= $4 per unit

Units must be sold = (Quantity of products + Total fixed costs) ÷ Contribution per unit

= ($280,000 + $800,000) ÷ $4

= $1,080,000 ÷ $4

= $270,000

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