A Product Sells for $20 Per Unit, and Has a Contribution

question 127

Multiple Choice

A product sells for $20 per unit, and has a contribution margin ratio of 40%. Fixed expenses total $120,000 annually. How many units must be sold to yield a profit of $30,000?

• A)12,500 units.
• B)20,000 units.
• C)18,750 units.
• D)25,000 units.