Company XYZ produces and sells headphones. The company has total fixed costs of $112,000. Each headphone sells for $315 per unit and has variable costs of $225 per unit. Next year XYZ Company wishes to earn an operating income that equals 90% of fixed costs. How many units must be sold to achieve this target income level? (rounded to the nearest number) Select one: O a. 2,364 ОБ.1,244 О с. 394 O d. 124 О е. 207

Company XYZ produces and sells headphones. The company has total fixed costs of $112,000. Each headphone sells for $315 per unit and has variable costs of $225 per unit. Next year XYZ Company wishes to earn an operating income that equals 90% of fixed costs. How many units must be sold to achieve this target income level? (rounded to the nearest number) Select one: O a. 2,364 ОБ.1,244 О с. 394 O d. 124 О е. 207

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 7MC: Company A wants to earn $5,000 profit in the month of January. If their fixed costs are $10,000 and...

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Gelbart Company manufactures gas grills. Fixed costs amount to 16,335,000 per year. Variable costs per gas grill are 225, and the average price per gas grill is 600. Required: 1. How many gas grills must Gelbart Company sell to break even? 2. If Gelbart Company sells 46,775 gas grills in a year, what is the operating income? 3. If Gelbart Companys variable costs increase to 240 per grill while the price and fixed costs remain unchanged, what is the new break-even point?
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