2. Target profit = $12,000 =7,500 units
Unit contribution margin $1.60 per unit
Thus, the company must sell 7,500 units above the break-even point to
earn a profit of $12,000 each month. These units, added to the 21,000
units required to break even, would equal total sales of 28,500 units
each month to reach the target profit figure.
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