In 2019, X Company sold 5,600 units of its only product. Total revenue was $1,440,880, total...

Question

Question

In 2019, X Company sold 5,600 units of its only product. Total revenue was $1,440,880, total variable costs were $566,720, an

Answer 1

Answer #1

Answer : Units to be sold to earn $35000 in 2020	4794	Units

Calculation for 2019
	Units	Per Unit	Total
Sale	5600	$ 257.30	$1,440,880
Less: Variable cost	5600	$ 101.20	$566,720
Contribution	5600	$ 156.10	$874,160

Calculation of Contribution per unit in 2020
		Per Unit	Total
Sale		$ 257.30
Less: Variable cost	=101.20+5	$ 106.20
Contribution per unit		$ 151.10

New Fixed cost	=714000-24700	$689,300
Target Profit		$ 35,000
Number of Units to earn target profit in 2020	=Fixed cost + Target profit/Contribution per pizza
	=(689300+35000)/$151.10
	4793.51
	4794	units	(Rounded off)

Answer 2

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