The financial information of the company is as follows:Sales units: 200Price per unit: $30Fixed cost: $400Variable cost per unit: $20What would be the profit if 400 and 500 units are sold? Create a data table for the same.Options :$2,000 and $3,500$3,600 and $4,600$2,500 and $3,200$4000 and $6,500
Question
The financial information of the company is as follows:Sales units: 200Price per unit: 400Variable cost per unit: 2,000 and 3,600 and 2,500 and 4000 and $6,500
Solution 1
To calculate the profit, we first need to understand the formula for profit. The formula for profit is:
Profit = Total Revenue - Total Cost
Where: Total Revenue = Price per unit * Number of units sold Total Cost = Fixed Cost + Variable Cost * Number of units sold
Let's calculate the profit for 400 units sold:
Total Revenue = 12,000 Total Cost = 20 * 400 = 12,000 - 3,600
Now, let's calculate the profit for 500 units sold:
Total Revenue = 15,000 Total Cost = 20 * 500 = 15,000 - 4,600
So, the profit if 400 and 500 units are sold would be 4,600 respectively.
Here is the data table:
| Units Sold | Total Revenue | Total Cost | Profit |
|---|---|---|---|
| 400 | $12,000 | $8,400 | $3,600 |
| 500 | $15,000 | $10,400 | $4,600 |
So, the correct option is 4,600.
Solution 2
To calculate the profit, we first need to understand the formula for profit. The formula for profit is:
Profit = Total Revenue - Total Cost
Where: Total Revenue = Price per unit * Number of units sold Total Cost = Fixed Cost + Variable Cost * Number of units sold
Let's calculate the profit for 400 units sold:
Total Revenue = 12,000 Total Cost = 20 * 400 = 12,000 - 3,600
Now, let's calculate the profit for 500 units sold:
Total Revenue = 15,000 Total Cost = 20 * 500 = 15,000 - 4,600
So, the profit if 400 and 500 units are sold would be 4,600 respectively.
Here is the data table:
| Units Sold | Total Revenue | Total Cost | Profit |
|---|---|---|---|
| 400 | $12,000 | $8,400 | $3,600 |
| 500 | $15,000 | $10,400 | $4,600 |
So, the correct option is 4,600.
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