HPHM 4314 - Desired target operating income $20,000; unit price for sales
Question # 00500863
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Updated on: 03/16/2017 01:21 AM Due on: 03/16/2017
Assume the following: (1) Desired target operating income $20,000; unit price for sales $500; variable costs per unit $300; total fixed cost $10,000. (2) We have applied the formula to calculate the contribution margin method of determining target operating income, and have arrived at a numerator amount of $30,000 (20,000 plus 10,000) and a denominator amount of $200 (500 minus 300). (3) These figures yield an answer of 150 units (30,000 divided by 200). What is the required revenue to achieve the target operating income of $20,000?
- A.$30,000
- B.$45,000
- C.$75,000
- D.$150,000
- E.None of the above
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Solution: HPHM 4314 - Desired target operating income $20,000; unit price for sales