Jenna Manufacturers produces flooring material
The monthly fixed costs are $16,000 per month. The sales price per unit is $95 and variable cost per unit is $35. If Jenna's managers create a CVP graph from volume levels of zero to 800 units, at what sales level (in units) will the revenue and total cost lines intersect? (Round your answer up to the nearest whole unit.)
A) 267 units
B) 169 units
C) 458 units
D) 124 units
A .A) Required sales in units = (Fixed costs + Target profit) / Contribution margin per unit
Unit contribution margin = Net sales revenue per unit - Variable costs per unit
Sales price $95
Less: variable cost (35 )
Contribution margin 60
Fixed costs 16,000
Required sales in units ($16,000 / $60 ) $267
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