The President of DynaMark Will Not Receive a Bonus Next

question 6

Multiple Choice

The president of DynaMark will not receive a bonus next year unless the company's profits are at least $435,000.DynaMark sells a single product at a price of $27 per unit.If variable costs are $12 per unit and fixed costs total $150,000, what amount of unit sales must DynaMark generate in order for the president to receive a bonus?

• A)48,750 units
• B)39,000 units
• C)29,000 units
• D)21,167 units

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Definitions:

Operating Costs

Expenditures that are necessary for the day-to-day operations of a business, including costs related to manufacturing, sales, and administration.

Interest Charges

Interest charges are the costs incurred by an entity for borrowing money, quantified as a percentage of the principal loan amount.

Assets

Economic resources or owned items of value that an individual, corporation, or country possesses, expected to provide future benefits.

Net Income

Net income refers to the total earnings of a company once all costs, expenses, and taxes are deducted from the overall revenue.