Question
Future Company wants to earn a net income of $250,000 next year. Its products are priced at $300 per unit for the coming year. Product
Future Company wants to earn a net income of $250,000 next year. Its products are priced at $300 per unit for the coming year. Product costs are as follows: Direct materials per unit of product $50 Direct labor per unit of product $100 Variable overhead per unit of product $12 Total fixed factory overhead $600,000 Variable selling expense is a commission of 5 percent of price. Fixed selling and administrative expense totals $300,000. Future Company has a tax rate of 35 percent. Based on the given information, calculate the number of units that will yield an operating income of $600,000. (Round answer to the nearest dollar.) a. $12,195 b. $11,300 c. $10,000 d. $12,000
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