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Question - Units to Earn Target Income
Head-First Company plans to sell 5,000 bicycle helmets at $75 each in the coming year. Unit variable cost is $45 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Total fixed cost equals $49,500 (includes fixed factory overhead and fixed selling and administrative expense).
Required: Be sure to read the instructions on each panel for additional guidance.
1. Calculate the number of helmets Head-First must sell to earn operating income of $81,900.
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