E10-13 Effect of Taxes on Break-Even and Target Volume LO6 Yosemite Enterprises desires to earn an after-tax income of $150,000. It has fixed costs of $1,000,000, a unit sales price of $500, and unit variable costs of $200. The company is in the 30% tax bracket. How many dollars of sales revenue must be earned to achieve the after-tax profit of $150,000? How many dollars of revenue would have to be earned to achieve $150,000 of profit, if there had been no income tax?

E10-13 Effect of Taxes on Break-Even and Target Volume LO6 Yosemite Enterprises desires to earn an after-tax income of $150,000. It has fixed costs of $1,000,000, a unit sales price of $500, and unit variable costs of $200. The company is in the 30% tax bracket. How many dollars of sales revenue must be earned to achieve the after-tax profit of $150,000? How many dollars of revenue would have to be earned to achieve $150,000 of profit, if there had been no income tax?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 13E

See similar textbooks

Similar questions

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.
E10-13. Effect of Taxes on Break-Even and Target Volume LO6 Yosemite Enterprises desires to earn an after-tax income of $150,000. It has fixed costs of $1,000,000, a unit sales price of $500, and unit variable costs of $200. The company is in the 30% tax bracket. 1. How many dollars of sales revenue must be earned to achieve the after-tax profit of $150,000? 2. How many dollars of revenue would have to be earned to achieve $150,000 of profit, if there had been no income tax?
sub question 1 and 2
CVP; operating leverage; income statementRacine Tire Co. manufactures tires for all-terrain vehicles. The tires sell for $60, and variable cost per tire is $30; monthly fixed cost is $450,000.a. What is the break-even point in units and sales dollars?Break-even point in units: Break-even in sales dollars: b. If Ronnie Rice, the company’s CEO, wants the business to earn a pre-tax profit of 25 percent of revenues, how many tires must be sold each month? c. If the company is currently selling 20,000 tires monthly, what is the degree of operating leverage? d. 1. If the company can increase sales volume by 15 percent above the current level, what will be the increase in net income? What will be the new net income?New net income $ Increase in net income $ 2. Prove your calculations with an income statement.Note: Do not use negatives signs with your answers.
Give true answer this financial accounting question
A company is making plans for next year, using cost-volume-profit analysis as its planning tool. Next year's sales data about its product are as follows Selling price P60 Variable manufacturing costs per unit 22.50 Variable selling and administrative costs 4.5 Fixed operating costs (60% is manufacturing costs) P159,500 Income tax rate 30% How much should sales be next year if the company wants to earn profit after tax of P23,100, the same amount that it earned last year?
Need Step by step answer
1
Help, I know the answer is between b and d but I am not sure which one?, please solve it by yourself A company requires $600,000 in sales to meet its target net income after tax. Itscontribution margin is 40%, and fixed costs are $80,000. How much is the target netincome, given that its after-tax rate is 70%?a. $160,000b. $112,000c. $400,000d. $48,000
Cost accounting
Newell company wishes to earn a pre tax income please solve this question
Chapter: Cost Volume Profit (CVP) Analysis Q) Chaudhary Group Ltd manufactures premium high definition televisions. The firm’s fixed costs are $4,000,000 per year. The variable cost of each TV is $2,000, and the TVs are sold for $3,000 each. The company sold 5,000 TVs during the previous year. (In the following requirements, ignore income taxes) Required: Treat each of the requirements as independent situations:a) Calculate the break-even point in units. b) What will the new break-even point be if fixed costs increase by 10 per cent? c) What was the company’s net profit for the previous year? d) The sales manager believes that a reduction in the sales price to $2,500 will result in orders for 1,200 more TVs each year. What will the break-even point be if the price is changed?