2. Krismuch Co. estimated that the company can sell 200,000 units of a product next period and earn a profit of P350,000 after tax of 30%. Fixed costs are estimated at P480,000 for the period. Variable costs are equal to two thirds of sales revenue. To meet this objective, what price must be charged for each unit of product? 3. Fronteeth Corp. plans to sell 500,000 units of a product at a price of P19.50 per unit. Fixed costs for the period have been budgeted at P750,000. The profit after tax has been budgeted at P480,000 with an income tax rate of 40%, In order to meet the above requirements, how much should be the variable cost per unit?
2. Krismuch Co. estimated that the company can sell 200,000 units of a product next period and earn a profit of P350,000 after tax of 30%. Fixed costs are estimated at P480,000 for the period. Variable costs are equal to two thirds of sales revenue. To meet this objective, what price must be charged for each unit of product? 3. Fronteeth Corp. plans to sell 500,000 units of a product at a price of P19.50 per unit. Fixed costs for the period have been budgeted at P750,000. The profit after tax has been budgeted at P480,000 with an income tax rate of 40%, In order to meet the above requirements, how much should be the variable cost per unit?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Answer two items with full solution
Transcribed Image Text:2. Krismuch Co. estimated that the company can sell 200,000 units of a product
next period and earn a profit of P350,000 after tax of 30%. Fixed costs are
estimated
at P480,000 for the period. Variable costs are equal to two thirds
of sales revenue. To meet this objective, what price must be charged for
each unit of product?
3. Fronteeth Corp. plans to sell 500,000 units of a product at a price of P19.50
per unit. Fixed costs for the period have been budgeted at P750,000. The
profit after tax has been budgeted at P480,000 with an income tax rate of
40%, In order to meet the above requirements, how much should be the
variable cost per unit?
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