CompuTop Company sells toy laptop computers for $30 each. If the variable cost for each laptop is $20 and fixed costs total $25,000, how many laptops must CompuTop sell to generate a target income of $66,667?

$9,166.70

Explanation:

The computation of the number of laptop need to sell is shown below:

= (Fixed expenses + target profit) ÷ (Contribution margin per unit)  

where,  

Contribution margin per unit = Selling price per unit - Variable expense per unit  

= $30 - $20

= $10

And, the fixed cost is $25,000 + profit is $66,667

Now putting these values to the above formula

So, the number of laptops sells is

= ($25,000 + $66,667) ÷ ($10 per unit)

= $9,166.70

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