16.1

Olivian Company wants to earn $490,000 in net (after-tax) income next year. Its product is priced at $300 per unit. Product costs include: Vartable selling expense is $12 per unit; fixed selling and administrative expense totals $295,000, olivian has a tax rate of A0 percent, Required: 1. Calculate the before-tax profit needed to achieve an after-tax target of $480,000, 2. Calculate the number of units that will yeld operating income calculated in Requirement 1 above. If required, round your answer to the nearest whole unit. units 3. Prepare an income statement for Olivian Company for the coming year based on the number of units computed in Requirement 2 . Do NOT round interim calculations and, if required, round your answer to the nearest dollar. 4. What if Oivian had a 35 percent tax rate? Would the units sold to reach a $480,000 target net income be higher or lower than the uniti calculated in Requirement 27 Cafculate the number of units needed at the new tax rate. In your calculations, round before-tax income to the nearest dollar. Round your answer to the nearest whole unit. units