Question

gra. What is inventoryt. work 6 Saved Help Save & Exit S Check my w Exercise 11-18 Desired profit LO 11-5 Solomon Company incurs annual fixed costs of $83,670. Variable costs for Solomon's product are $18.60 per unit, and the sales price s $30.00 per unit Solomon desires to earn an annual profit of $48,000. Required Use the per unit contribution margin approach to determine the sales volume in units and dollars required to earn the desired profit. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) Sales in dollars Sales volume in units < Prev 8 of 9 Next INS

Answer 1

selling price variable cost contribution margin unit contribution margin ratio fixed costs target profit to earn ANSWERS sales in dollars sales volume in units 30.00 18.60 11.40 38% 83670 48000 346500 11550 working notes contribution margin per unit = sales price- variable cost unit = 30.00-18.60=11.40 contribution margin ratio= contribution margin per unit / sales price*100 = 11.40/30.00*100 = 38% sales in dollars = (fixed cost +desired profit )/contribution margin ratio = (83670+48000)/38%= $346,500 sales volume in dollars = (fixed cost+desired profit)/contribution margin unit = (83670+48000)/11.40= 11550