Walton's Warehouse reported sales of $640,000, a contribution margin of $8 per unit, fixed costs of $314,000, and a profit of $92,000. How many units did Walton's Warehouse sell?

Question

Quizplus · Accepted Answer

To find the number of units sold, use the formula: Profit = (Contribution Margin per Unit * Units Sold) - Fixed Costs. Rearranging gives Units Sold = (Profit + Fixed Costs) / Contribution Margin per Unit. Substituting the given values: Units Sold = ($92,000 + $314,000) / $8 = 50,750 units.

Walton's Warehouse Reported Sales of $640,000, a Contribution Margin of $8