Given breakeven sales in units of 22,000 and a unit contribution margin of $2.40, how many units must be sold to reach a target operating income of $4,524?
A) 4,863
B) 11,671
C) 23,885
D) 1,885

Question

Quizplus · Accepted Answer

To reach a target operating income of $4,524 with a unit contribution margin of $2.40, the number of units needed is calculated as follows: Target Operating Income / Unit Contribution Margin = $4,524 / $2.40 = 1,885 units. However, since the breakeven point is at 22,000 units, the total units needed to achieve the target operating income are 22,000 units (to break even) + 1,885 units (to achieve the target income) = 23,885 units.

Given Breakeven Sales in Units of 22,000 and a Unit