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A company has the following data for last year. Price per unit Variable cost per unit Fixed cost $300 $200 56,500 The company
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Answer #1

Answer: 885

Calculations:

Number of units required = (Desired before tax profit + Fixed cost) ÷ Contribution margin per unit

= ($32,000 + $56,500) ÷ 100

= $88,500 ÷ 100

= 885 units

.

Target profit after tax $ 25,600
Tax [$25,600 x 20/80] $ 6,400
Target profit before tax $ 32,000

Contribution margin per unit = $300-$200 =$100

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