A company manufactures and sells a single product whose selling price is P500 and whose variable expense is P300 per unit. The company’s monthly fixed expense is P120,000. Required: 1. Solve for the unit sales that are required to earn a target profit of P80,000. 2. If the company wants to earn a profit of P200,000, how much should be the sales revenue?

A company manufactures and sells a single product whose selling price is P500 and whose variable expense is P300 per unit. The company’s monthly fixed expense is P120,000. Required: 1. Solve for the unit sales that are required to earn a target profit of P80,000. 2. If the company wants to earn a profit of P200,000, how much should be the sales revenue?

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter6: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 3BE

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If a company has fixed costs of $6.000 per month and their product that sells for $200 has a contribution margin ratio of 30%, how many units must they sell in order to break even? A. 100 B. 180 C. 200 D. 2,000
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