Refer to Exercise 3.3.

Data from Exercise 3.3

Julianna Abdallah owns and operates FirstCakes, a bakery that creates personalized birthday cakes for a child’s first birthday. The cakes, which sell for $40 and feature an edible picture of the child, are shipped throughout the country. A typical month’s results are as follows:

Sales revenue . . . . . . . . . . . . .$840,000

Variable expenses . . . . . . . . .  630,000

Contribution margin . . . . . . .  210,000

Fixed expenses . . . . . . . . . . . . 112,000

Operating income . . . . . . . . .  $98,000

Required

a. How many cakes will Julianna Abdallah have to sell if she wants to earn $150,000 in operating  income each month?

b. Assuming a 30% tax rate, how many cakes will Julianna Abdallah have to sell if she wants to earn  $115,150 in net income each month?