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    Target Net Profits

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    A recent income statement of the Norwood Corporation reported the following data:
    Units sold 8700
    Sales revenue $7,200,000
    Variable costs 4,000,000
    Fixed costs 1,700,000

    If Norwood desires to earn a target net profit of $480,000, how many units would it have to sell?

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    Solution Preview

    For a target net profit units to be sold = (Fixed cost + target net profit)/unit ...

    Solution Summary

    This solution shows step-by-step calculations to determine how many units Norwood Corporation would have to sell to attain a profit of $480,000.