Hanley's Carwash has $80,000 of fixed costs and variable costs of 60% of sales. How much...

Hanley's Carwash has $80,000 of fixed costs and variable costs of 60% of sales. How much is total sales to achieve a net income of $140,000?

A) $550,000 B) $220,000 C) $150,000. D) $366,667

Expert Solution

The answer is Option A: $550,000

	Amount in $
Fixed cost	80,000
Add: Net Income	140,000
Contribution Margin	220,000
Variable Cost	60% of sales
Contribution Margin	40% of Sales
Sales	*220000100%/40%**
Sales	550,000

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