Given breakeven sales in units of 45,700 and a unit contribution margin of $6, how many units must be sold to reach a target operating income of $25,200?
A) 45,700
B) 49,900
C) 1,813
D) 4,200

Question

Quizplus · Accepted Answer

To reach a target operating income of $25,200 with a unit contribution margin of $6, the required number of units can be calculated as follows: Target Operating Income / Unit Contribution Margin = $25,200 / $6 = 4,200 units. Since the breakeven point is at 45,700 units, the total units needed to achieve the target income is 45,700 units (to break even) + 4,200 units (to achieve the target income) = 49,900 units.

Given Breakeven Sales in Units of 45,700 and a Unit