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Primus Company unit sales price; Trinity Corp unit sales

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1. The following information is for a product of Primus Company:

Last year, the variable cost per unit was $22. Total fixed costs were $800,000. At a volume of 170,000
units, the company achieved a profit of $50,000.

What was the unit sales price for the product last year?

2. The following information is for a product manufactured and sold by Trinity Corporation:

Sales price per unit, $35
Variable cost per unit, $20
Total fixed costs, $300,000
Last year, Trinity earned a profit of $30,000.

(a) How many units did Trinity sell last year?

(b) Trinity's managers are considering decreasing the sales price to $30 in an effort to increase market share. Also, the company wants a profit of $80,000. How many units would it have to sell at the lower selling price to achieve this target?

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Solution Summary

The solution computes Primus Company unit sales price and Trinity Corp unit sales and target profit.

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Question 1

Profit = Sales - Variable - Fixed Cost

Sales = 50000+ 170000*22 + 800,000 = $45,90,000

Unit Sale price = ...

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