Goy Company has a break-even point of 88,000 units.The contribution margin per unit is $9.60.The desired target profit is $18,096.How many units must be sold to achieve the desired profit?
A) 1,885 units
B) 88,000 units
C) 89,885 units
D) 106,096 units

Question

Quizplus · Accepted Answer

The formula to calculate the number of units required to achieve a target profit is:

(Total fixed costs + Target Profit) / Contribution Margin per unit

Substituting the values given in the problem, we get:

(88,000 x $9.60) + $18,096 / $9.60 = 89,885 units

Therefore, the answer is C, which is 89,885 units.

Goy Company Has a Break-Even Point of 88,000 Units