Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Hisham was a professional classical guitar player until a motorcycle accident left him disabled. After long months of therapy, he hired an experienced luthier and
Hisham was a professional classical guitar player until a motorcycle accident left him disabled. After long months of therapy, he hired an experienced luthier and started a small shop to make and sell Spanish guitars. The guitars sell for $700, and the fixed monthly operating costs are as follows: Rent and utilities Wages and benefits to luthier Other expenses $600 2,100 484 Hisham's accountant told him about contribution margin ratios, and Hisham understood clearly that for every dollar of sales, $0.70 went to cover his fixed costs, and anything above that point was profit Hisham wishes to ean $3,500 of operating profit each month. Calculate the number of guitars Hisham will need to sell to achieve the target profit. (Round your answer up to the nearest whole guitar.) A 14 guitars O B. 5 guitars C. 13 guitars D. 4 guitars
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started