Please provide answer this general accounting question A company produces a product with variable costsof $3.20 per unit. The product sells for $6.50 perunit. The company has fixed costs of $4,500 anddesires a profit of $12,000.What is the sales level in units required to achievethe desired profit?

Step 1: Define Break-Even and Target Profit AnalysisBreak-even and target profit analysis is a…

Answered: A company produces a product with…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section14.A: Breakeven Analysis

Problem 7P

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Delta Co. sells a product for $150 per unit. The variable cost per unit is $90 and fixed costs are $15,250. Delta Co.s tax rate is 36% and the company wants to earn $44,000 after taxes. What would be Deltas desired pre-tax income? What would be break-even point in units to reach the income goal of $44,000 after taxes? What would be break-even point in sales dollars to reach the income goal of $44000 after taxes? Create a contribution margin income statement to show that the break-even point calculated in B, generates the desired after-tax income.
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The profit function for two products is: Profit3x12+42x13x22+48x2+700, where x1 represents units of production of product 1, and x2 represents units of production of product 2. Producing one unit of product 1 requires 4 labor-hours, and producing one unit of product 2 requires 6 labor-hours. Currently, 24 labor-hours are available. The cost of labor-hours is already factored into the profit function, but it is possible to schedule overtime at a premium of 5 per hour. a. Formulate an optimization problem that can be used to find the optimal production quantity of products 1 and 2 and the optimal number of overtime hours to schedule. b. Solve the optimization model you formulated in part (a). How much should be produced and how many overtime hours should be scheduled?
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A company produces a product with variable costs of $3.20 per unit. The product sells for $6.50 per unit. The company has fixed costs of $4,500 and desires a profit of $12,000. What is the sales level in units required to achieve the desired profit?