Marissa Corporation produces and sells a single product. Data concerning that product appear below: Selling price per unit……………….. $125.00 Variable expense per unit………… $72.50 Fixed expense per month………… $272,448 Required: Assume the company's monthly target profit is $200,000. Determine the units that must be sold to attain that target profit.
Marissa Corporation produces and sells a single product. Data concerning that product appear below:
Selling price per unit……………….. $125.00
Variable expense per unit………… $72.50
Fixed expense per month………… $272,448
Required:
Assume the company's monthly target profit is $200,000. Determine the units that must be sold to attain that target profit.
In order to determine the units to be sold to attain that target profit, the fixed cost and the target profit are required to be divided by the contribution margin per unit. By subtracting the variable cost per unit from the selling price per unit, one can calculate the contribution margin per unit.
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