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

question 2

Multiple Choice

A product sells for $20 per unit and has a contribution margin ratio of 40%.Fixed expenses total $240,000 annually.How many units of the product must be sold to yield a profit of $60,000?

• A) 30,000 units.
• B) 37,500 units.
• C) 40,000 units.
• D) 65,000 units.

Appreciate the significance of maintaining congruency between journal and ledger account titles.

Apply understanding of accounting principles to categorize transactions correctly.

Evaluate the completeness and accuracy of accounting records.

Understand the impact of transactions on owner's equity and net income.

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Definitions:

Legal

Pertains to matters governed by law, statutes, or regulations and recognized or enforced by a judicial system.

Tit-For-Tat Strategy

A cooperative, reciprocative strategy in game theory where an entity responds to an opponent's action with similar action.

Pricing Strategy

The approach a company uses to determine the best price for its products or services to maximize profits and meet customer expectations.

Tacit Collusion

Coordination between competing firms that occurs without direct communication, often through price signaling or market strategies, avoiding explicit agreements.