2-47 Multiproduct breakeven analysis and target profit, taxes Wren Company produces three products with the following characteristics: Planned unit sales Price per unit Variable cost per unit. REGULAR CUSTOM 13,000 $13 $6 10,000 $18 $9 DELUXE 8,000 $21 $15 Total fixed costs at Wren Company are $200,000 per year. Required (a) Assuming a constant sales mix, how many units of each of the three products must Wren Company sell in order to break even? (b) Assuming a constant sales mix, if Wren Company faces a tax rate of 30% and has a target after-tax income of $50,000, how many units of each of the three products must Wren Com- pany sell? (LO2, 3)
2-47 Multiproduct breakeven analysis and target profit, taxes Wren Company produces three products with the following characteristics: Planned unit sales Price per unit Variable cost per unit. REGULAR CUSTOM 13,000 $13 $6 10,000 $18 $9 DELUXE 8,000 $21 $15 Total fixed costs at Wren Company are $200,000 per year. Required (a) Assuming a constant sales mix, how many units of each of the three products must Wren Company sell in order to break even? (b) Assuming a constant sales mix, if Wren Company faces a tax rate of 30% and has a target after-tax income of $50,000, how many units of each of the three products must Wren Com- pany sell? (LO2, 3)
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter6: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 4BE
Related questions
Question
6
![2-47 Multiproduct breakeven analysis and target profit, taxes Wren Company produces three (LO2, 3)
products with the following characteristics:
Planned unit sales
Price per unit..
Variable cost per unit
REGULAR CUSTOM DELUXE
13,000
$13
$6
10,000
$18
$9
8,000
$21
$15
Total fixed costs at Wren Company are $200,000 per year.
Required
(a) Assuming a constant sales mix, how many units of each of the three products must Wren
Company sell in order to break even?
(b) Assuming a constant sales mix, if Wren Company faces a tax rate of 30% and has a target
after-tax income of $50,000, how many units of each of the three products must Wren Com-
pany sell?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa5470c16-a091-4a24-bc57-d8f57d2f978b%2F6e647d67-f1de-43a1-ab15-dd1fe55523d3%2F7hams3c_processed.jpeg&w=3840&q=75)
Transcribed Image Text:2-47 Multiproduct breakeven analysis and target profit, taxes Wren Company produces three (LO2, 3)
products with the following characteristics:
Planned unit sales
Price per unit..
Variable cost per unit
REGULAR CUSTOM DELUXE
13,000
$13
$6
10,000
$18
$9
8,000
$21
$15
Total fixed costs at Wren Company are $200,000 per year.
Required
(a) Assuming a constant sales mix, how many units of each of the three products must Wren
Company sell in order to break even?
(b) Assuming a constant sales mix, if Wren Company faces a tax rate of 30% and has a target
after-tax income of $50,000, how many units of each of the three products must Wren Com-
pany sell?
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