Respuesta :
Franco runs a pie shop in a busy metropolis. He sells his fresh pies for $7, but it costs him $2.50 to make them. The cooking equipment in his shop cost him $46,000. Franco need to sell 21,333 pies to make a profit of $50,000.
Desired Profit = $50,000
Let the required number of pies to sell be given by ‘P’.
Profit is calculated as,
Profit = Total Revenue - Total Costs
Where,
Total Revenue = Selling price x Number of pies
Total Costs = Fixed cost + (Variable cost x Number of pies)
Putting the given values in the above formula,
Profit = Total Revenue - Total Costs
$50,000 = $7P - ($46,000 + $2.5P)
$50,000 = $7P - $46,000 - $2.5P
$4.5P = $96,000
Number of pies P = 21,333 pies.
Making sure that marketing and sales goals align with profit targets is the goal of profit-based sales target metrics. The level of unit sales or revenues required to not only pay a firm's costs but also to achieve its profit targets is determined by managers in target volume and target revenue calculations, which go beyond break-even analysis (the point at which a corporation sells enough to cover its fixed costs).
Managers frequently ask what sales levels will be necessary to achieve a certain dollar profit before beginning a program. The number of units sold must meet a target volume (#) in order to achieve a desired profit. The same amount in terms of dollar sales is the target revenue ($).
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