Chicago Company incurs annual fixed costs of $80,000.Variable costs are $3.00 per unit,and the sales price is $10 per unit.Chicago desires to earn an annual profit of $60,000.
Required:
Use the contribution margin ratio approach to determine the sales volume in dollars and units needed to earn the desired profit.

Question

Quizplus · Accepted Answer

The Answer of Chicago Company incurs annual fixed costs of $80,000.Variable costs are $3.00 per unit,and the sales price is $10 per unit.Chicago desires to earn an annual profit of $60,000.
Required:
Use the contribution margin ratio approach to determine the sales volume in dollars and units needed to earn the desired profit.

Chicago Company Incurs Annual Fixed Costs of $80,000