Select your language

Suggested languages for you:
Log In Start studying!
Answers without the blur. Just sign up for free and you're in → Illustration


Financial & Managerial Accounting
Found in: Page 834
Financial & Managerial Accounting

Financial & Managerial Accounting

Book edition 7th
Author(s) John J Wild, Ken W. Shaw, Barbara Chiappetta
Pages 1096 pages
ISBN 9781259726705

Short Answer

SBD Phone Company sells its waterproof phone case for $90 per unit. Fixed costs total $162,000, and variable costs are $36 per unit. Compute the units of product that must be sold to earn a pre-tax income of $200,000. (Round to the nearest whole unit.)

The business entity will sell 6,704 units to earn a pre-tax income of $200,000.

See the step by step solution

Step by Step Solution

Step 1: Definition of Break-Even Units

The number of units that a business entity must sell to achieve the situation of no-profit, no-loss is known as break-even units. It is calculated using the fixed cost and the contribution margin per unit.

Step 2: Units to be sold for pre-tax income of $200,000

Recommended explanations on Business-studies Textbooks

94% of StudySmarter users get better grades.

Sign up for free
94% of StudySmarter users get better grades.