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What is its target monthly operating income

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Question - Patel Motors is a small car dealership. on average, it sells a car for $29,000, which it purchases from the manufacturer for $25,000. Each month, Patel Motors pays $59,800 in rent and utilities and $72,000 for salespeople's salaries. In additio to their salaries, salespeople are paid a commission of $800 for each car they sell. Patel Motors also spends $9,000 each month for local advertisements. It's tax rate is 40%.

How many cars must Patel Motors sell each month to break even?

Patel has a target monthly net income of $57,600. What is its target monthly operating income? How many cars must be sold each month to reach the target monthly net income of $57,600?

Reference no: EM132647411

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