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Roosevelt Inc. breaks even when it sells 1,600 units. The company's variable cost per unit is $10 and the selling price is $25 per unit. The total fixed cost are $24,000 & the contribution margin is $24,000. How many units does Roosevelt need to sell to earn $40,000 in net income?

Respuesta :

adrianamaya1225

Answer

the answer would be 55%

Explanation:

I did the math and stuff.

your welcome

hope it helped.

Tundexi

Roosevelt need to sell 4,267 units to earn $40,000 in net income.

Particulars                                      Amount

Selling price per unit                       $25

Less: Variable cost per unit           ($10)

Contribution margin per unit       $15

  • Now, we will calculate the number of units that Roosevelt needs to sell to earn  $40,000 in net income.

Number of Units = (Fixed cost + Target net income) / Contribution margin per unit

Number of Units = ($24,000 + $40,000) / $15

Number of Units = $64,000 / $15

Number of Units = 4,267 units

Therefore, Roosevelt need to sell 4,267 units to earn $40,000 in net income.

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