Question

- Survey of Accounting Concepts U pt In 2019, X Company sold 5,450 units of its only product. Total reveme was $1,262,255, $645,825, and total fixed costs were $672,000. In 2020, there are only two expected changes: variable $3,30 per unit, and fixed costs will increase by $40.400. How many units mumst X Company se $34,000 or unit, and fixed costs were $672 7. A 5,095 BO 7,388 CO 10,712 DO 15,532 EO 22,522 18 pt / In 2019, X Company's profit function was 0.34R - $91.800. whe "evenue and variable costs will not change, but fived was 51,462,235, total variable costs were changes: variable costs will increase ty company sell in 2020 in order to em FO evenue have to be in order for Y 32,657

Answer 1

7. Sales per unit = 1462235/5450 = $268.3 per unit

Variable cost per unit = 645825/5460 = $118.50

Contribution margin per unit = 268.3 - (118.50+3.30) = $146.5 per unit

Units required to Sale = (Fixed expense+desired profit)/ contribution margin per unit

= (672000+40400+34000)/146.50

= 5095 units

Option A. is correct answer.