
A company manufactures a single product as shown.
- selling price £20 per unit
- variable costs £15 per unit
Its budgeted fixed costs are £200,000.
How many units must the company sell to make a net profit of £50,000?
Select ONE answer:
- 10 000 units
- 30 000 units
- 40 000 units
- 50 000 units
Show your workings to arrive at your answer, and explain and justify your reasons:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………
This multiple-choice question is suitable for Accounting KS5 classes.
The answer is 3
- Not correct
- Not correct
- Not correct
- Correct – CM = £20 – £15 = £5 ==> £200,000 / £5 = 40,000 units ==> £50,000 Profit / CM £5 = 10,000 units TOTAL 50,000 units
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