If the Sale Price Per Unit Is $100, Variable Expenses

question 253

Multiple Choice

If the sale price per unit is $100, variable expenses per unit are $45, target operating income is $35,000, and total fixed expenses are $20,000, how many units must be sold to reach the target operating income?

• A) 350
• B) 364
• C) 1,000
• D) 636

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Definitions:

Long-Term Debt

Loans and financial obligations lasting over one year that appear on a company's balance sheet.

Current Liability

A current liability is a financial obligation that is due to be settled within one year or within the normal operating cycle of the business, whichever is longer.

FICA Taxes

Taxes mandated by the Federal Insurance Contributions Act, which fund Social Security and Medicare, collected from both employers and employees.

FUTA Taxes

Federal Unemployment Tax Act taxes, which are payroll taxes paid by employers to fund the government’s unemployment benefits.