If fixed costs are $80,000, the contribution margin is $25 per unit, and the targeted profit is $30,000, then the required unit sales are
A) 4,400 units.
B) 2,000 units.
C) 4,500 units.
D) 2,500 units.

Question

Quizplus · Accepted Answer

The contribution margin per unit is $25, and the targeted profit is $30,000. So, the required contribution margin is $30,000 + $80,000 = $110,000. The required unit sales are $110,000 / $25 = 4,400 units.

If Fixed Costs Are $80,000, the Contribution Margin Is $25