Sparkle Jewelry sells 700 units resulting in $ 90,000 of sales revenue, $31,000 of variable costs,...

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Question

Sparkle Jewelry sells 700 units resulting in $ 90,000 of sales revenue, $31,000 of variable costs,...

Sparkle Jewelry sells 700 units resulting in $ 90,000 of sales revenue, $31,000 of variable costs, and $ 20,000 of fixed costs. The number of units that must be sold to achieve $ 42,000 of operating income is ________.

A. 620 units

B. 736 units

C. 238 units

D. 499 units

business accounting

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Answer 1

Answer #1

Contribution = $90000 - $31000 = $59000

Contribution per unit = $59000/700 = $84.29

Target profit = $42000

Fixed cost = $20000

Contribution required = $62000

Units required = $62000/$84.29

= 736 units

Hence the answer is option B.

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Answer 2

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Add Answer to: Sparkle Jewelry sells 700 units resulting in $ 90,000 of sales​ revenue, $31,000 of variable​ costs,...

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Sparkle Jewelry sells 700 units resulting in $ 90,000 of sales revenue, $31,000 of variable costs,...

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Sparkle Jewelry sells 700 units resulting in $ 90,000 of sales revenue, $31,000 of variable costs,...