For profit planning purposes, the following equation is used: Target Sales Units = (FC + P) CM per Unit.

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This equation is commonly known as the breakeven point formula and is used to calculate the number of units a company needs to sell in order to cover fixed costs, variable costs, and achieve a targeted profit. FC stands for fixed costs, P stands for target profit, and CM per Unit stands for contribution margin per unit.

For Profit Planning Purposes, the Following Equation Is Used: Target