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Gates Rubber Company sells widgets for $20.00 each. The manufacturing costs, all variable, are $6 each. The company is planning on renting an exhibition booth
Gates Rubber Company sells widgets for $20.00 each. The manufacturing costs, all variable, are $6 each. The company is planning on renting an exhibition booth for display and selling purposes at the annual candy convention. The company's sales manager will earn a vacation bonus if she can earn a target net income of $150,000 for the sales operation at the convention. The convention organizers provide the advertising and guarantee a certain level of traffic in exchange for 15% of the net income. The 15% surcharge operates like a tax on net income. The company absorbs all of the fixed costs of production for the sales made at the convention. Required: How many widgets does the sales manager have to sell to earn the vacation bonus
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