Question

Wildhorse Corporation has fixed costs of $301,500. It has a unit selling price of $9.15, unit variable cost of $7.65, and a target net income of $1,545,000. Compute the required sales in units to achieve its target net income.

Answer 1

the required sales in units to attain the target net income is 1,231,000 units

Step-by-step explanation:

The computation of the required sales in units to attain the target net income is given below:

= (Fixed cost + target net income) ÷ (contribution margin per unit)

= ($301,500 + $1,545,000) ÷ ($9.15 - $7.65)

= 1,231,000 units

Hence, the required sales in units to attain the target net income is 1,231,000 units