Scheidel Enterprises, Inc. produces and sells a single product whose selling price is $190.00 per unit and whose variable expense is $81.70 per unit. The company's monthly fixed expense is $682,290.
-Assume the company's monthly target profit is $21,000.The unit sales to attain that target profit are closest to:

Question

Quizplus · Accepted Answer

Unit CM = Selling price per unit - Variable expenses per unit
= $190.00 per unit - $81.70 per unit = $108.30 per unit
Unit sales to attain a target profit = (Target profit + Fixed expenses)F1F1F1S1F1F1F10 Unit CM
= ($682,290 + $21,000)F1F1F1S1F1F1F10 $108.30 per unit
=$703,290 F1F1F1S1F1F1F10 $108.30 per unit = 6,494 units