Question

If fixed costs are $1,242,000, the unit selling price is $232, and the unit variable costs are $108, what is the amount of sales in units (rounded to a whole number) required to realize an operating income of $212,000?

a.11,726 units

b.11,500 units

c.5,353 units

d.1,963 units

Answer #1

Sol. Let the Number of units Sold=X

Profit= Sales - Variable Expenses - fixed Cost

$212,000 =($ 232 x X) - ($108 x X) - $1242,000

$212,000= $232X - $108X - $1,242,000

$ 212,000 + $1,242,000 =$ 124X

$124X = $ 1454,000

X = $ 1454,000/ $124

X=11,725.8 OR x= 11,726

Number of unit's sold 11726 unit's to realize an Operating income of $212,000, Option (a.) 11,726 unit's

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4.00
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