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Hounshell Corporation: Compute unit and dollar sales for tar

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Please also see attached file.

Hounshell Corporation produces and sells a single product. Data concerning that product appear below:

Selling price per unit $121.00
Variable expense per unit $48.80
Fixed expense per month $268,720

Required:
a. Assume the company's monthly target profit is $20,080. Determine the unit sales to attain that target profit.

Unit sales to attain target profit ___________units

b. Assume the company's monthly target profit is $7,060. Determine the dollar sales to attain that target profit. (Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)

Dollar sales to attain target profit $______________

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Solution Summary

Formulas are given and computed for Hounshell Corporation.

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Target profit is an extension of break-even analysis....you add the target profit to the fixed costs to get the level needed. Here are the two potential formulas....you need the first one for a and the second ...

Solution provided by:
Carol Sargent, PhD
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
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