SDZ Corporation Produces and Sells a Single Product

question 140

Essay

SDZ Corporation produces and sells a single product. Its selling price is $15 per unit, and the variable cost per unit is $12. Total fixed costs per month are $3,000.
a)What is SDZ's contribution margin per unit?
b)Calculate the monthly breakeven point in units.
c)How many units must SDZ sell for a pre-tax target profit of $10,000 per month?

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Definitions:

Federal Government

The national government of a federated state, which holds the supreme legislative, executive, and judicial power over a country.

Net Income

The total earnings of a company after all expenses and taxes have been deducted from total revenue.

Social Security Administration

The Social Security Administration is a U.S. government agency responsible for administering social insurance programs, including retirement, disability, and survivors' benefits.

Rate Of Return

A measure of the profitability of an investment, calculated as a percentage of the original investment.