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Cost-Volume-Profit Analysis Practice Problems Break-Even Units: Units for Target Profit Jay-Zee Company makes an in-car navigation system. Next year, Jay-Zee plans to sell 16,000 units
Cost-Volume-Profit Analysis Practice Problems Break-Even Units: Units for Target Profit Jay-Zee Company makes an in-car navigation system. Next year, Jay-Zee plans to sell 16,000 units at a set price of $320 each. Product costs include: Direct materials Direct labor Variable Overhead Total fixed factory overhead S500,000 S68 $40 $12 Variable selling expense is a commission of 5 percent of price; fixed selling and administration expenses total S116,400 Calculate the number of units Jay-Zee Company must sell to achieve target operating income (profit) of $333,408. 4. What if the Jay-Zee Company wanted to achieve a target operating income of $322,000? Would the number of units needed increase or decrease compared to your answer in Requirement 3? Compute the number of units needed for the new target operating income. 5
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