Answer:
A. 5,600 units
Explanation:
selling price less variable price = contribution per unit
33 -28 = 5
each units generates 5 contribution to pay up the fixed cost and make a gain
target: 4,000 fixed cost + 24,000 income = 28,000
target / contribution per unit = required sales volume
28,000 / 5 = 5,600 untits
By selling this amount of units the company will pay up their fixed cost and achieve a projected gain for $24,000
Answer:
A. 5 comma 600 units
Explanation:
The profit is a function of the sales and cost of an organization. The cost elements are in two groups namely; Fixed cost and variable cost. The variable cost is a function of the level of activities.
Given;
Targeted income = $24,000
Variable cost per unit = $28
Total fixed cost = $4,000
Unit selling price = $33
Let the number of units be u
33u - (28u + 4000) = 24000
5u = 28000
u = 5600
The right answer is A. 5 comma 600 units
