Required Sales in Dollars to Meet a Target Net Income

question 115

Multiple Choice

Required sales in dollars to meet a target net income is computed by dividing

• A) fixed costs plus target net income by unit contribution margin.
• B) variable costs plus target net income by unit contribution margin.
• C) fixed costs plus target net income by contribution margin ratio.
• D) total costs plus target net income by contribution margin ratio.

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Definitions:

Supply-side Economics

An economic theory that suggests lower taxes and decreased regulation will stimulate the economy by increasing production.

Lower Income-tax

The reduction in the rate at which personal income is taxed, aiming to increase disposable income for individuals.

Federally Guaranteed

Refers to financial or other forms of guarantees provided by the federal government, ensuring the fulfillment of certain obligations or repayment of debts.

New Right

A political movement that emerged in the late 20th century, advocating for conservative policies, free-market economics, and traditional values.