Question

Prin of Managerial Accounting ACG-2071C-24018-MW8:30AM Paola Dalmau & Quiz: Comprehensive Final Time Remaining:01:43.20 Submit Quiz This Question: 4 pts 23 of 33 (22 complete) This Quiz: 100 pts possible Sunlight Design Corporation sells glass vases at a wholesale price of $2.50 per unit. The variable cost to manufacture is $2.00 per unit. The monthly fixed costs are $7,500,00. Its current sales are 27.000 units per month the company wants to increase its operating income by 20%, how many additional units must itsel? (Round any intermediate calculations to two decimal places and your final answer up to the nearest whole number) O A 2,400 glass vases OB. 67,500 glass vases OC. 29,400 glass vases OD. 7.500 glass vases

Answer 1

	Qty	Rate	Amount
Sales	27000	2.5	$     67,500
Less variable cost	27000	2	$     54,000
			$     13,500
		Less fixed cost	$        7,500
		Current operating profit	$        6,000
		Add 20%	$        1,200
		Desired operating profit	$        7,200
		Desired Contribution required	Fixed cost + Desired operating profit
		=	$     14,700
		Sales required                               =	Desired Contribution
			Contribution per unit
		=	$     14,700
			0.5
		=	29400
		Addition units                            =	sales required - Current sales
		=	29400 - 27000
		=	2400
			Answer is        (A )