XYZ Company has a variable cost ratio of 40%, fixed expenses of $200,000, and desires to earn operating income of $100,000.

XYZ Company has a variable cost ratio of 40%, fixed expenses of $200,000, and desires to earn operating income of $100,000. Total sales revenue required to achieve XYZ Company’s desired operating income is

SolutionVariable cost ratio = 40%Fixed costs = $ 200,000Operating income = $ 100,000Operating Income = Total revenue – Variable costs – Fixed costsLet the sales revenue be xVariable costs…