Kelvin Co.produces and sells socks.Variable costs are $4 per pair,and fixed costs for the year total $90,000.The selling price is $6 per pair.The sales units required to make a before-tax profit of $12,000 are:

Question

Quizplus · Accepted Answer

To find the sales units required to achieve a before-tax profit of $12,000, use the formula: Required Sales Units = (Fixed Costs + Desired Profit) / (Selling Price - Variable Cost). Plugging in the values: (90,000 + 12,000) / (6 - 4) = 51,000 units.

Kelvin CoProduces and Sells Socks