Paradise Inc estimates that it can sell 50000 of its calcula

Paradise Inc. estimates that it can sell 50,000 of its calculators for $50 each. Assuming a total target profit of $1,000,000, how much is the target cost per calculator?

Solution

Quantity that can be sold = 50000

Target profit = 1000000

Target profit per calculator =Target profit/Total quantity 1000000/50000 = 20

Target cost per calculator = Sales price per calculator - Target cost per calculator

= 50 - 20 = 30

Target cost per calculator is $30.

Paradise Inc. estimates that it can sell 50,000 of its calculators for $50 each. Assuming a total target profit of $1,000,000, how much is the target cost per c

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