A company produces a single product, with a selling price of $20 and a variable cost of $8 per unit. Fixed costs are $180,000 per period. What volume of sales in units is needed to earn a profit of $84,000 per period? a. 13,200 b. 15,000 c. 18,000 d. 22,000

A company produces a single product, with a selling price of $20 and a variable cost of $8 per unit. Fixed costs are $180,000 per period. What volume of sales in units is needed to earn a profit of $84,000 per period? a. 13,200 b. 15,000 c. 18,000 d. 22,000

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 36P: Faldo Company produces a single product. The projected income statement for the coming year, based...

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Question

Can you explain the correct methodology to solve this general accounting problem?

A company produces a single product, with a selling
price of $20 and a variable cost of $8 per unit. Fixed
costs are $180,000 per period. What volume of sales
in units is needed to earn a profit of $84,000 per
period?
a. 13,200
b. 15,000
c. 18,000
d. 22,000

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