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QUESTION 6 How much sales are required to earn a target income of $120,000 if total fixed costs are $150,000 and the contribu
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$675000 is required sales to attain profit of $120000.

Required Sales to attain Target Profit
Dollar Sales=(Target Profit+Fixed Expenses)/Contribution Ratio
Fixed Costs 150000
Contribution Ratio 40%
Target Profit 120000
So, putting figures in this formula we have Dollar Sales 675000
=(120000+150000)/40%
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