Garth Corporation manufactures and sells T-shirts. In 2018, the shirts sold for $7.50 each

and the variable cost associated with each shirt was $2.25. The company needed to sell 20,000 shirts to

breakeven. Income after taxes for 2018 was $5,040. Garths expectations for 2019 include the

following:

• The sales price of the T-shirts will be $9.50
• Variable manufacturing costs will increase by two-thirds
• Fixed costs will increase by 10%
• The income tax rate will remain at 40%

1. Calculate the number of T-shirts Garth must sell to breakeven in 2019.
2. What amount of sales dollars will it take to earn $22,500 after taxes for 2019?