Break-even sales and sales to realize operating income For the current year ended March 31, Cosgrove Company expects fixed costs of $382,200, a unit variable cost of $42, and a unit selling price of $63. a. Compute the anticipated break-even sales (units). units b. Compute the sales (units) required to realize operating income of $88,200. units

1. 18,200 units

2. 22,400 units

Explanation:

Cosgrove Company

1.Computation of the anticipated break-even sales (units

Using this formula

Contribution per unit = selling price - variable cost per unit

= $63 - $42 = $21

Formula for Break Even Sales (units)

Break Even Sales (units) = (fixed cost÷contribution per unit)

= ($382,200÷$21)

= 18,200 units.

2.Computation of the sales (units) required to realize operating income of $88,200. units

Using this formula

Desired Sales (units) = (fixed cost + desired operating income)÷contribution per unit.

= ($382,200 + $88,200)÷$21

= $470,400 ÷ $21

= 22,400 units.

The advice Bruce G. Smith offers those who are interested in a career in marketing or business is to get involved at work, in your industry, and your community. Also he states to never stop learning about new or better ways to market.

Explanation: