e Edit View History Bookmarks Window Help PM Kyle M Act 1000

e Edit View History Bookmarks Window Help PM Kyle M Act 1000 wa50 201 WI (A Test: Week #3 Exam #6 This Question: 1 pt Kyle Masano 1 1/26/18 5:30 PM Time Remaining: 00:40-37 Submit Test 6of14(0completo) This Test: 14 pts possible Elolet was a professional dlassical guitar playor until his motorcyole accident that left him disabled. Afer long months of therapy, he hired an experienced luthier (maker of stringed instruments) and started a small shop to make and sell Spanish guitars. The guitars sel for $900 and the fiwed monthly operating oosts are as follows: Rent and ubilities Wages and benelfts to luthier $1.230 3,000 700 Oher expenser ar Eloffs accourtant told him abo contbden magn nion and he understood dantythatfor everydelar of sales, $0.75-ernt to cover his fand cosa and that anything past that point was pure pri Eliolt wishes to eam $5,200 of operating prolit each month. Caloulate the amount of sales revenue required to achieve the target proft OB $13.507 O C. $5,200 OD, $0.904 Click to select your answer

Solution

Required sales in dollars = (Fixed costs + Target proft) / Contribution margin ratio
Contribution margin ratio = 75% Total fxed costs = $1230 + $3,000 + $700 = $4930
Target proft = $5200
Required sales in dollars = ($4930 + $5,200) / 75% = $13,507

Ans B 13507

Required sales in dollars = (Fixed costs + Target proft) / Contribution margin ratio Contribution margin ratio = 75% Total fxed costs = $1230 + $3,000 + $700 = $4930 Target proft = $5200 Required sales in dollars = ($4930 + $5,200) / 75% = $13,507 Ans B 13507