7/26/2019 A Tshirt Manufacturer Spends

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QUESTION :

A tshirt manufacturer spends $1200 each day on costs plus $3 per shirt for

labor and materials. the shirts sell for $12 each. How many shirts must the

company sell in one day to make a profit of $500?

ANSWER :

A t-shirt manufacturer spends $1200 each day on costs plus $3 per shirt for labor

and materials. The t-shirts sell for $12 each. How many t-shirts must the company

sell in one day to make a profit of $500?Let the number of t-shirts be x.

Fixed costs = 1200

Variable cost (labour and materials) per t-shirt = 3

So total variable cost for x shirts = 3*x

Total cost = 1200 + 3*x

If the profit is 500, then the total selling price = 1200 + 3*x + 500 = 1700 + 3*x -----

(1)

Selling price of 1 shirt = $12So selling price of x shirts = 12*x ------(2)

Equating both (1) and (2)

1700 + 3*x = 12*x

1700 = 9*x

x = 1700/9 = 188.88

So number of T-shirts to be sold to make a profit of $500 = 189 (rounding off

to next whole number)