The contribution margin ratio of Kuck Corporation's only product is 75%. The company's monthly fixed expense is $585,000 and the company's monthly target profit is $11,250. Required:Determine the dollar sales to attain the company's target profit.
What will be an ideal response?
Dollar sales to attain target profit = (Target profit + Fixed expenses) ÷ CM ratio
= ($585,000 + $11,250) ÷ 0.75 = $795,000
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