Miguel Manufacturing Has Fixed Costs of $2,500,000 and Variable Costs

question 112

Multiple Choice

Miguel Manufacturing has fixed costs of $2,500,000 and variable costs are 40% of sales.What are the required sales if Montoya desires an operating income of $250,000?

• A)$4,583,333
• B)$4,166,667
• C)$6,875,000
• D)$6,250,000

---

Definitions:

Effective Rate

The actual interest rate an investor receives after taking into consideration compounding.

Monthly Compounded Rate

An interest rate applied to the principal and the accumulated interest of a loan or investment on a monthly basis.

Department Store

A retail establishment offering a wide range of consumer goods in different product categories known as "departments."

Compounded Monthly

Interest on an investment or loan is calculated and added to the principal amount at the end of each month.