The girls' toy company “Barbie fashion” has fixed costs worth S/ 15,000 and a variable cost of S/ 20 per unit; Furthermore, each barbie sells for S/ 120. How many barbies must be produced and sold for the company to achieve profits of S/ 55,000?
Question
Answer:
To determine how many Barbies must be produced and sold for the company to achieve profits of S/ 55,000, we can use the following profit formula:
Profit = (Selling Price per Unit - Variable Cost per Unit) * Number of Units - Fixed Costs
In this case:
Selling Price per Unit (S) = S/120
Variable Cost per Unit (VC) = S/20
Fixed Costs (FC) = S/15,000
Desired Profit (P) = S/55,000
Number of Units (N) is what we want to find.
Substituting these values into the profit formula:
S/55,000 = (S/120 - S/20) * N - S/15,000
First, let's simplify the equation by finding a common denominator for the fractions:
S/55,000 = (5S/600 - 30S/600) * N - S/15,000
Now, combine the fractions:
S/55,000 = (-25S/600) * N - S/15,000
Next, let's get rid of the fractions by multiplying both sides of the equation by their common denominator, which is 600:
600 * (S/55,000) = 600 * (-25S/600) * N - 600 * (S/15,000)
Simplifying further:
(S * 600) / 55,000 = (-25S * 600 / 600) * N - (S * 600) / 15,000
Now, simplify the right side of the equation:
(600S / 55,000) = (-25S) * N - (600S / 15,000)
Now, we have:
(600S / 55,000) = -25S * N - (600S / 15,000)
To isolate N, we'll start by moving the second term on the right side to the left side of the equation:
(600S / 55,000) + (600S / 15,000) = -25S * N
Now, combine the fractions:
[(600S * 15,000 + 600S * 55,000) / (55,000 * 15,000)] = -25S * N
Simplify the left side:
[600S * (15,000 + 55,000) / (55,000 * 15,000)] = -25S * N
Now, divide both sides by -25S to solve for N:
N = [(600S * 70,000) / (55,000 * 15,000)]
Now, plug in the values for S:
N = [(600 * 70,000) / (55,000 * 15,000)]
N ≈ 1.33
Since you can't produce a fraction of a Barbie, you should round up to the nearest whole number. Therefore, you would need to produce and sell approximately 2 Barbies to achieve profits of S/55,000.
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10 months ago
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