Everest Ltd. wants to earn a pre-tax incomeof $75,000. The company has total fixedcosts of $150,000, and the contributionmargin per unit is $10.00.How many units must be sold to earn thetargeted pre-tax income?

Step 1: Definition of Target Sales in UnitsTarget Sales in Units refers to the number of units a…

Answered: Everest Ltd. wants to earn a pre-tax…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 13E

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Everest Ltd. wants to earn a pre-tax income of $75,000. The company has total fixed costs of $150,000, and the contribution margin per unit is $10.00. How many units must be sold to earn the targeted pre-tax income?