Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Dorcan Corporation manufactures and sells T-shirts imprinted with college names and slogans. Last year, the shirts sold for $8.00 each, and the variable cost to

Dorcan Corporation manufactures and sells T-shirts imprinted with college names and slogans. Last year, the shirts sold for $8.00 each, and the variable cost to manufacture them was $3.75 per unit. The company needed to sell 20,000 shirts to break-even. The after tax net income last year was $6,180. Donnelly's expectations for the coming year include the following: (CMA adapted) The sales price of the T-shirts will be $10. Variable cost to manufacture will increase by one-third. Fixed costs will increase by 10%. The income tax rate of 40% will be unchanged. Based on a $10 selling price per unit and if Dorcan Corporation wishes to earn $81,987 in after tax net income for the coming year, the company's sales volume in dollars must be: Multiple Choice $45,389. $46,829. $44,429. $460,290.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cost And Management Accounting Volume I

Authors: Gautam Kumar Jana

1st Edition

1642875554, 9781642875553

More Books

Students also viewed these Accounting questions