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Aritzia Inc. produces three types of clothing: shirts - contribution margin $12, pants -contribution margin $10, and skirts - contribution margin $5. Sales are 50%
Aritzia Inc. produces three types of clothing: shirts - contribution margin $12, pants -contribution margin $10, and skirts - contribution margin $5. Sales are 50% shirts, 30% pants, and 20% skirts. Management at Aritzia Inc. insists that sales should always be in this proportion.
If Aritzia Inc. faces a tax rate of 25%, has total fixed costs of $3,000,000, and has a target after tax profit of $300,000, what is the total unit sales of the 3 products required to hit the target after-tax profit?
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