For flynn company, variable costs are 60% of sales, and fixed costs are $177,600. management’s net income goal is $68,520. compute the required sales in dollars needed to achieve management’s target net income of $68,520. (use the contribution margin approach

The required sales in dollars are $615,300.

Explanation:

Variable costs increase and decrease with sales, if your sales rise, the variable costs will rise too. Yet, the contribution marginal remains equal. It is calculated as . Another form to express that equation is . Sales/sales is equal to 1, and variable costs/sales is 0.60. So, the contribution margin is equal to 40%, or $0.4 per each dollar of sales.

Then, in order to calculate how much sales you need to pay the fixed costs, you need this equation . That means that you need $444,000 of sales to cover the fixed costs.

The same calculation is used to obtain the sales needed to achieve the target net income: .

If you add the two results, then you obtain that you need dollars of sales to achieve the target net income of $68,520.

answer: e

explanation:

1. c

2. b

3. a

4. c

5. a

6. b

7. c

8. c

9.b

10. d

just took it 100%