Assume the Following Information How Many Units Must Be Sold to Generate a Before-Tax

question 43

Multiple Choice

Assume the following information: $\begin{array}{llr} \text { Selling price per unit} &\$150\\ \text { Contribution margin ratio } &40\%\\ \text { Total fixed costs } &\$225,000\end{array}$
How many units must be sold to generate a before-tax profit of $45,000?

• A)2,500 units
• B)3,000 units
• C)3,750 units
• D)4,500 units

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Definitions:

Probability

A numerical measure of the likelihood of a specific event occurring, ranging from 0 to 1.

Mutually Exclusive

Mutually exclusive refers to events in probability and statistics that cannot occur at the same time, indicating that the occurrence of one event necessarily excludes the occurrence of the other.

Collectively Exhaustive

A set of events is collectively exhaustive if at least one of the events must occur.

Probability

A measure of the likelihood that an event will occur, expressed on a scale from 0 (impossibility) to 1 (certainty).