Target sales volume

Can anyone break it down to me how you calculate the target sales volume of 38793 at the bottom?
Many thanks
AAT Level 2. 2018
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Comments

  • ammw90ammw90 Registered Posts: 24
    Hi,

    Targeted fixed cost per unit is £11.60 and since fixed costs (in total) remained as before (£450,000):

    £450,000/£11.60 = 38793.10345 = 38793

    Let me know if you want me to break it down further :)

    A
  • dumutrobadumutroba AAT Student, AATQB Posts: 207
    Thank you very much for your input
    Much appreciated
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  • jmhjmh Registered Posts: 29
    Hello,

    Can you please explain where the £450,000 came from. I am revising at the moment and stuck on the same question just the task has different figures to this one.

    Thank you
  • dumutrobadumutroba AAT Student, AATQB Posts: 207
    edited January 18
    It is in the condition of the task at the top
    Annual costs expected to be 450000

    Not sure where is it on your task though
    Apply a screenshot
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  • jmhjmh Registered Posts: 29
    Please see attached this is the task I am working on and the answer is 25,217 units but I am struggling with the fix costs. I thought it might be the 65,000+45,000+35,000 = 145,000 but am not sure.



    thank you for your help
  • dumutrobadumutroba AAT Student, AATQB Posts: 207
    edited January 18
    You are correct R&D are fixed costs, apparently Fixed manufacturing costs are fixed and end of life cost are fixed.
    All cost not directly related to production are fixed, unless they are specifically named as such, as the fixed manufacturing costs in this case
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  • jmhjmh Registered Posts: 29
    thank you
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