The ABC Distributing (ABC) 2019 profit and lossstatement shown below. The depicted relationships are validwithin $14,000,000.00 to $65,000,000.00. What level of saleswould a new salesperson have to produce if annualcosts (salary, expenses, and other traceable costs)were $80,000 and ABC wanted to makea 5% return (ROS) on the incrementalsales?

ABC 2019 Profit and Loss Statement*

Sales	$	20,000,000
Cost of goods sold		12,000,000
Gross margin		8,000,000
Variable costs		2,000,000
Fixed costs		4,000,000
Total costs		6,000,000
Profit (before taxes)	$	2,000,000

*Taxes are eliminated from the analysis to simplify and
focus the calculations.

Answer rating: 100% (QA)

Formulae for Sales to earn desired Profit Fixed Cost Profit Contributio... View the full answer