DPZ Corporation sells a single product, Delicious Pizza, for $10 per pizza. Total fixed costs are \$420,000 per month and the contribution margin ratio is 40\%. How much sales revenue would DPZ need to earn to generate a profit of 10\% of its sales revenue?\n\$1,050,000\n\$945,000\n\$840,000\n\$1,400,000\nNone of the above
Added by Michael G.
Close
Step 1
To calculate the number of conversions, we need to multiply the conversion rate by the cost per month. Number of conversions = Conversion rate * Cost per month Number of conversions = 10% * $420.00 Number of conversions = $42.00 Show more…
Show all steps
Your feedback will help us improve your experience
Madhur L and 63 other Principles of Accounting educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Recommended Videos
Selling price per unit $ 100 Variable expenses per unit $ 40 Fixed expenses per month $ 60,000 Operating income at a volume of 4,000 units per month is: Multiple Choice A) $240,000. B) $200,000. C) $180,000. D) $120,000.
Madhur L.
How much will a company's net operating income change if it undertakes an advertising campaign given the following data: Cost of advertising campaign $ 25,000 Variable expense as a percentage of sales 42 % Increase in sales $ 60,000 A) $200 increase B) $25,200 increase C) $15,000 increase D) $9,800 increase
Aparna S.
Sale revenue = 120,000
Audrey F.
Recommended Textbooks
Horngren’s Cost Accounting
Cost Accounting A Managerial Emphasis
Principles of Accounting Volume 1: Financial Accounting
Transcript
18,000,000+
Students on Numerade
Trusted by students at 8,000+ universities
Watch the video solution with this free unlock.
EMAIL
PASSWORD