Question
Carson Company produces and sells two products: A and B in the ratio of 3A to 5B. Selling prices for A and B are, respectively,
Carson Company produces and sells two products: A and B in the ratio of 3A to 5B. Selling prices for A and B are, respectively, $1,200 and $240; respective variable costs are $480 and $160. The company's fixed costs are $1,800,000 per year.
Compute the volume of sales in units of each product needed to:
Required:
a. | break even. |
b. | earn $800,000 of income before income taxes. |
c. | earn $800,000 of income after income taxes, assuming a 30 percent tax rate. |
d. | earn 12 percent on sales revenue in before-tax income. |
e. | earn 12 percent on sales revenue in after-tax income, assuming a 30 percent tax rate. |
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