Lone International Corporation's only product sells for $230.00 per unit and its variable expense is $80.50.The company's monthly fixed expense is $822,250 per month.The unit sales to attain the company's monthly target profit of $33,000 is closest to:

Question

Quizplus · Accepted Answer

Unit CM = Selling price per unit - Variable expenses per unit
= $230.00 per unit - $80.50 per unit
= $149.50 per unit
Unit sales to attain a target profit = (Target profit + Fixed expenses)F1F1F1S1F1F1F10 Unit CM
= ($33,000 + $822,250)F1F1F1S1F1F1F10 $149.50 per unit
= $855,250 F1F1F1S1F1F1F10 $149.50 per unit
= 5,721 units

Lone International Corporation's Only Product Sells for $230