Compute the Level of Sales Required to Attain a Target Profit.
Lin Corporation has a single product whose selling price is $120 and whose variable cost is $80 per unit. The company's monthly fixed expense is $50,000.
Required:
1. Using the equation method, solve for the unit sales that are required to earn a target profit of $10,000.
2. Using the contribution margin approach, solve for the dollar sales that are required to earn a target profit of $15,000.