Below is a condensed income statement for Sophia Corporation: Sales (15,000 unit
ID: 2480439 • Letter: B
Question
Below is a condensed income statement for Sophia Corporation:
Sales (15,000 units)
$300,000
Variable expenses (15,000 units)
180,000
Contribution margin
$120,000
Fixed expenses
80,000
Operating income
$40,000
How many units must Sophia sell to earn before-tax profits of $60,000?
Below is a condensed income statement for Sophia Corporation:
Sales (15,000 units)
$300,000
Variable expenses (15,000 units)
180,000
Contribution margin
$120,000
Fixed expenses
80,000
Operating income
$40,000
How many units must Sophia sell to earn before-tax profits of $60,000?
Explanation / Answer
Answer:-
Unit Sales= Fixed Costs + Profits/ Selling Price per Unit - Variable Costs per Unit
= 80000+60000/300000/15000-180000/15000
=1,40,000/ 20- 12
=17500 units
Unit Sales= Fixed Costs + Profits/ Selling Price per Unit - Variable Costs per Unit
= 80000+60000/300000/15000-180000/15000
=1,40,000/ 20- 12
=17500 units
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