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Iguana Company sells a single product. Iguana estimates demand and costs at various activity levels as follows:

Units Sold Price Total Variable Costs Fixed Costs
120,000 $48 $3,000,000 $1,000,000
140,000 $45 $3,500,000 $1,000,000
160,000 $40 $4,000,000 $1,000,000
180,000 $35 $4,500,000 $1,000,000
200,000 $30 $5,000,000 $1,000,000

What price should Iguana charge to maximize profits?

A. $48

B. $35

C. $40

D. $30

E. $45

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M943115

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