Snower Corporation sells product G for $150 per unit,the variable cost per unit is $105,and the fixed costs are $720,000.What is the sales (in dollars)required to realize income from operations of $40,000?
A)$2,533,333
B)$1,773,333
C)$2,400,000
D)$1,680,000

Question

Quizplus · Accepted Answer

To find the required sales, use the formula: Sales = (Fixed Costs + Desired Income) / Contribution Margin Ratio. Contribution Margin per unit = Selling Price - Variable Cost = $150 - $105 = $45. Contribution Margin Ratio = $45 / $150 = 0.3. Required Sales = ($720,000 + $40,000) / 0.3 = $2,533,333.

Snower Corporation Sells Product G for $150 Per Unit,the Variable