Pecan,Inc. ,has a contribution margin of 50% and fixed costs of $220,000.What sales revenue is needed to attain a $60,000 profit?
A)$70,400
B)$440,000
C)$560,000
D)$240,000

Question

Quizplus · Accepted Answer

The equation to solve for the required sales revenue is:
Sales - Variable costs - Fixed costs = Profit
Or, rearranging:
Sales = (Profit + Fixed costs) / Contribution margin
Plugging in the given values:
Sales = ($60,000 + $220,000) / 0.5
Sales = $560,000
Therefore, the answer is choice C.

Pecan,Inc ,Has a Contribution Margin of 50% and Fixed Costs