Question
A. Last year, Cayman Corporation had sales of $6,961,986, total variable costs of $2,580,213, and total fixed costs of $1,592,018. In addition, they paid $480,000
A. Last year, Cayman Corporation had sales of $6,961,986, total variable costs of $2,580,213, and total fixed costs of $1,592,018. In addition, they paid $480,000 in interest to bondholders. Cayman has a 21% marginal tax rate. If Cayman's sales increase 5%, what should be the increase in earnings per share?
B. Tom's Trashbins Inc. has fixed costs of $225,395. The firm's sales are expected to be $427,252 this year if the firm sells 9,435 units. Variable costs amount to 40 percent of sales. What is the breakeven point in units for Tom's Trash bins?
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