Zeus, inc. produces a product that has a variable cost of $9.50 per unit. the company's fixed costs are $40,000. the product sells for $12.00 a unit and the company desires to earn a $20,000 profit. what is the volume of sales in units required to achieve the target profit

Break-even point= 96,000 units

Explanation:

Giving the following information:

Zeus, Inc. produces a product that has a variable cost of $9.50 per unit. The company's fixed costs are $40,000. The product sells for $12.00 a unit and the company desires to earn a $20,000 profit.

To calculate the sales in units, we need to use the break-even formula:

Break-even point= (fixed costs + profit) / contribution margin

Break-even point= (40,000 + 200,000) / (12 - 9.5)= 96,000 units

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