Toys Manufacturing incurs annual fixed costs of P250,000 in producing and selling “Tales.” Estimated unit sales for 2019 are 125,000. An after-tax income of P75,000 is desired by management. The company projects its income tax rate at 40 percent. What is the maximum amount that Toys can expend for variable costs per unit and still meet its profit objective if the sales price per unit is estimated at P6? P3.37 P3.59 P3.00 P3.70
Toys Manufacturing incurs annual fixed costs of P250,000 in producing and selling “Tales.” Estimated unit sales for 2019 are 125,000. An after-tax income of P75,000 is desired by management. The company projects its income tax rate at 40 percent. What is the maximum amount that Toys can expend for variable costs per unit and still meet its profit objective if the sales price per unit is estimated at P6? P3.37 P3.59 P3.00 P3.70
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Toys Manufacturing incurs annual fixed costs of P250,000 in producing and selling “Tales.” Estimated unit sales for 2019 are 125,000. An after-tax income of P75,000 is desired by management. The company projects its income tax rate at 40 percent. What is the maximum amount that Toys can expend for variable costs per unit and still meet its profit objective if the sales price per unit is estimated at P6?
- P3.37
- P3.59
- P3.00
- P3.70
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