Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized Deductions (Itemized). Price and variable costs for the two services are listed below. Sales price (per return) Variable costs (per return) Standard $ 90.00 50.00 The annual fixed costs at Grixdale are $332,500. Based on experience, the owner estimates that Standard Deduction returns represent 25 percent of the the firm's business. Standard Deduction returns Itemized Deduction returns Itemized $330.00 110.00 Required: How many Standard Deduction and Itemized Deduction returns must be filed annually to break even? Break-Even Sales in Units
Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized Deductions (Itemized). Price and variable costs for the two services are listed below. Sales price (per return) Variable costs (per return) Standard $ 90.00 50.00 The annual fixed costs at Grixdale are $332,500. Based on experience, the owner estimates that Standard Deduction returns represent 25 percent of the the firm's business. Standard Deduction returns Itemized Deduction returns Itemized $330.00 110.00 Required: How many Standard Deduction and Itemized Deduction returns must be filed annually to break even? Break-Even Sales in Units
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing
model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized
Deductions (Itemized). Price and variable costs for the two services are listed below.
Sales price (per return)
Variable costs (per return)
Standard
$ 90.00
50.00
The annual fixed costs at Grixdale are $332,500. Based on experience, the owner
estimates that Standard Deduction returns represent 25 percent of the the firm's
business.
Standard Deduction returns
Itemized Deduction returns
Itemized
$ 330.00
110.00
Required:
How many Standard Deduction and Itemized Deduction returns must be filed annually
to break even?
Break-Even
Sales in Units](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ffe16019e-4a6b-450a-beda-1ec0d8e068f0%2F239693fb-ce5b-4e4d-9525-dd4055ead83c%2Fhqdxduk_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing
model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized
Deductions (Itemized). Price and variable costs for the two services are listed below.
Sales price (per return)
Variable costs (per return)
Standard
$ 90.00
50.00
The annual fixed costs at Grixdale are $332,500. Based on experience, the owner
estimates that Standard Deduction returns represent 25 percent of the the firm's
business.
Standard Deduction returns
Itemized Deduction returns
Itemized
$ 330.00
110.00
Required:
How many Standard Deduction and Itemized Deduction returns must be filed annually
to break even?
Break-Even
Sales in Units
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