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monitta
2 years ago
10

Ivanhoe Corporation has fixed costs of $507,200. It has a unit selling price of $9.00, unit variable cost of $7.35, and a target

net income of $1,552,000.
Required:
Compute the required sales in units to achieve its target net income.
Business
1 answer:
nika2105 [10]2 years ago
6 0

Answer:

Break-even point in units= 1,248,000

Explanation:

Giving the following information:

Unitary contribution margin= 9 - 7.35= $1.65

Fixed costs= $507,200

Desired profit= $1,552,000

<u>To calculate the number of units to be sold, we need to use the following formula:</u>

Break-even point in units= (fixed costs + desired profit) / contribution margin per unit

Break-even point in units= (507,200 + 1,552,000) / 1.65

Break-even point in units= 1,248,000

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