Preston Products produces a disinfecting liquid. The liquid is sold in one gallon containers and has the following price and cost characteristics. Sales price $ 62.00 per gallonVariable costs 38.00 per gallonFixed costs 535,200 per monthPreston Products is subject to an income tax rate of 20 percent. Required:How many gallons must Preston Products sell every month to break even? How many gallons must Preston Products sell to earn a monthly operating profit of $87,000 after taxes? Note: Round your answer to the nearest whole number. Break-even sales in gallons: Number of gallons to be sold:

Preston Products produces a disinfecting liquid. The liquid is sold in one gallon containers and has the following price and cost characteristics. Sales price $ 62.00 per gallonVariable costs 38.00 per gallonFixed costs 535,200 per monthPreston Products is subject to an income tax rate of 20 percent. Required:How many gallons must Preston Products sell every month to break even? How many gallons must Preston Products sell to earn a monthly operating profit of $87,000 after taxes? Note: Round your answer to the nearest whole number. Break-even sales in gallons: Number of gallons to be sold:

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 20E

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