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You have been provided with the following information If sale

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You have been provided with the following information:
If sales decrease by 200 units, how much will fixed costs
have to be reduced by to maintain the current operating
profit of $8,000?
$1,600.
$6,400.
$4,200.
$2,600. Per Unit Total Sales$21 $ 42,000 Less
variable expenses13 26,000 Contribution margin8
16,000 Less fixed expenses8,000 Operating
profit$8,000
Solution
Units: (42000/21) ; 2000-200 Per Unit 2000 Units
Sales 21 42000 Less Variable Expenses 13 26000
Contribution Margin 8 16000 Less: Fixed Expenses 8000
Operating Profit 8000 Fixed cost reduced by 8000-
6400 =1600

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You have been provided with the following information: If sales decrease by 200 units, how much will fixed costs have to be reduced by to maintain the current operating profit of $8,000? $1,600. $6,400. $4,200. $2,600. Per Unit Total Sales$21 $ 42,000 Less variable expenses13 26,000 Contribution ma ...
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