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Required: A) Compute the break- even points in units B) How many unit must be sold to earn a profit of $30,000.00 ? C)Suppose Milton would like to earn operating income equal to 20 percent of sales revenue. How many units must be sold for this goal to be realized? D) For the projected level of sales, compute the margin of safety.

Required: A) Compute the break- even points in units B) How many unit must be sold to earn a profit of $30,000.00 ? C)Suppose Milton would like to earn operating income equal to 20 percent of sales revenue. How many units must be sold for this goal to be realized? D) For the projected level of sales, compute the margin of safety.

Understanding Business
Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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2) Milton Company's projected profit for the coming year is as follows: Description Total Per Unit Sales 200,000.00 $ 20.00 less: Variable expenses 120,000.00 12.00 Contribution margin 80,000.00 $ 8.00 Less fixed expenses 64,000.00 Operating income 16,000.00 Required: A) Compute the break- even points in units B) How many unit must be sold to earn a profit of $30,000.00 ? C)Suppose Milton would like to earn operating income equal to 20 percent of sales revenue. How many units must be sold for this goal to be realized? D) For the projected level of sales, compute the margin of safety.
Transcribed Image Text:2) Milton Company's projected profit for the coming year is as follows: Description Total Per Unit Sales 200,000.00 $ 20.00 less: Variable expenses 120,000.00 12.00 Contribution margin 80,000.00 $ 8.00 Less fixed expenses 64,000.00 Operating income 16,000.00 Required: A) Compute the break- even points in units B) How many unit must be sold to earn a profit of $30,000.00 ? C)Suppose Milton would like to earn operating income equal to 20 percent of sales revenue. How many units must be sold for this goal to be realized? D) For the projected level of sales, compute the margin of safety.
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