Assume the Following Information: How Many Units Must Be Sold

question 149

Multiple Choice

Assume the following information: How many units must be sold to generate a before-tax profit of $45,000?
$\begin{array}{lr}\text { Selling price per unit } & \$ 100 \\\text { Contribution margin ratio } & 50 \% \\\text { Total fixed costs } & \$ 250,000\end{array}$

• A)2,500 units
• B)3,000 units
• C)3,750 units
• D)5,900 units

---

Definitions:

Processed Further

A decision-making situation in managerial accounting regarding whether to continue processing a product or material beyond its current stage in order to increase its value.

Intermediate Products

Products that are not the final goods but are used as inputs in the production of other goods or services.

Industrial Fiber

Fibers used in the manufacturing sector for the production of goods like textiles, composites, and other industrial materials.

Joint Production Costs

Costs incurred in the process of producing multiple products simultaneously from the same raw material or process.