Given the following information, how many units must be sold to achieve a profit

Question

Given the following information, how many units must be sold to achieve a profit of $21,000? (Note that the units sold must account for total production costs (direct and overhead) plus desired profit:

Direct labor hours:                                             0.6 hr / unit

Direct labor costs:                                           $25 / hr

Direct materials cost:                                      $5.1 / unit

Overhead costs:                                                 85% of direct labor

Packaging and shipping:                                  $2.6 / unit

Selling price:                                                     $38 / unit

Explanation / Answer

profit per unit = (38 - (0.6 *25 +5.1 + 0.85*(0.6*25) + 2.6)) = 2.55 $

Units to be sold = 21000 / 2.55 = 8235.29 units

Answer no of units to be sold = 8236 units

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