Cassius Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range.

Sales (7,000 units) $210,000

Variable expenses 136,500

Contribution margin 73,500

Fixed expenses 67,200

Net operating income $6,300

The number of units that must be sold to achieve a target profit of $31,500 is closest to:

A. 16,400 units

B. 42,000 units

C. 35,000 units

D. 9,400 units

= 9,400 units

Explanation:

Sales (7,000 units) $210,000

Variable expenses 136,500

Contribution margin 73,500

Fixed expenses 67,200

Net operating income $6,300

The number of units that must be sold to achieve a target profit of $31,500 is closest to:

Contribution Margin per item = $ 73,500 / 7000 items

=$ 10.50

Net income = contribution margin - fixed costs

$31,500 = 10.50x quantity - 67,200.00

$31,500=10.50Q-$ 67,200

10.50 q = 31500+67200

10.50 q = $ 98,700

q = $ 98700/10.50

Quantity = 9,400 units