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Sandbox Company Has a Predicted Operating Income of $34,800

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Essay

Sandbox Company has a predicted operating income of $34,800. Their total variable expenses are $28,000 and their total fixed expenses are $22,800. They have a unit contribution margin of $12.
1. Calculate the required sales in units to achieve the predicted operating income.
2. Calculate the required sales in units to achieve the predicted operating income if the company's fixed expenses double.


Definitions:

Regression Trend Line

A line on a scatter plot, derived from regression analysis, that shows the main trend of the relationship between two variables.

Mean Absolute Deviation

Mean absolute deviation is a measure of variability that represents the average absolute difference between each data point and the mean of the data set.

Sum of Squares

A statistical measure that quantifies the variance within a dataset by summing the squared differences between each value and the mean.

Forecast Accuracy

The degree to which forecasted values correspond with actual values over a specified period.

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