MBA560 Financial and Managerial Accounting: Module 6 Test Problem 1 Rivera Corporation

MBA560 Financial and Managerial Accounting
Module 6 Test

Problem 1.
The following information is for a product manufactured and sold by Rivera Corporation:
Sales price per unit 30
Variable cost per unit 20
Total fixed costs 200,000
Last year, Rivera earned a profit of $60,000

Required:
1) How many units did Rivera sell last year?
2) Rivera's managers are considering decreasing the sales price to $28 in an effort to increase market share. Also, the company wants a profit of $80,000. How many units would it have to sell at the lower selling price to achieve this target?
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