Baker Company Sells Its Product for £60

question 88

Multiple Choice

Baker Company sells its product for £60. In addition, it has a variable cost ratio of 40 percent and total fixed costs of £9,000. How many units must be sold in order to obtain a before-tax profit of £12,000?

• A) 350 units
• B) 584 units
• C) 875 units
• D) 333 units

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Definitions:

Directors

Members of a company's board who are elected by shareholders to make important decisions regarding the company's management and policies.

Officers

Executive members of an organization responsible for managing its day-to-day operations and making significant business decisions.

Due Care

The level of judgment, caution, and attentiveness expected of a reasonable person.

Negligence

Failure to take reasonable care to avoid causing injury or loss to another person, resulting in legal liability for the resulting harm.