Lupe is planning to expand their business manufacturing dream catchers. They have been doing well at local craft shows and in their online store, and feels that with a bigger manufacturing facility, with the addition of an employee, they will be able to expand and grow their business. They know that they would like a target profit of $60,000 annually. They also know that their selling price is $129 and their variable cost to produce the dream catcher is $57.28. The facility they are considering would make it possible for them to make 150 dream catchers per month. How much can they have in fixed costs per month to meet their target profit goal? O $14,350 O $5,758
Lupe is planning to expand their business manufacturing dream catchers. They have been doing well at local craft shows and in their online store, and feels that with a bigger manufacturing facility, with the addition of an employee, they will be able to expand and grow their business. They know that they would like a target profit of $60,000 annually. They also know that their selling price is $129 and their variable cost to produce the dream catcher is $57.28. The facility they are considering would make it possible for them to make 150 dream catchers per month. How much can they have in fixed costs per month to meet their target profit goal? O $14,350 O $5,758
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Lupe is planning to expand their business manufacturing dream catchers. They have been doing well at local craft shows and in their
online store, and feels that with a bigger manufacturing facility, with the addition of an employee, they will be able to expand and grow
their business. They know that they would like a target profit of $60,000 annually. They also know that their selling price is $129 and
their variable cost to produce the dream catcher is $57.28. The facility they are considering would make it possible for them to make
150 dream catchers per month. How much can they have in fixed costs per month to meet their target profit goal?
O $14,350
O $5,758
O $5,000
O She cannot meet her goal at that level of sales per month.
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