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Break-Even and Net Income Planning Paulson Company has recently leased facilities for the manufacture of a new product. Based on studies made by its accounting
Break-Even and Net Income Planning Paulson Company has recently leased facilities for the manufacture of a new product. Based on studies made by its accounting personnel, the following data are available: Estimated annual sales: 40,000 units. Selling expenses are expected to be 10% of sales, and the selling price is $64 per unit. Ignore income tax in this problem. Required Compute a break-even point in dollars and in units. Assume that manufacturing overhead and administrative expenses are fixed but that other costs are variable. What would net income before income tax be if 30,000 units were sold? c. How many units must be sold to earn a net income before income tax of 10% of sales
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