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Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized Deductions
Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized Deductions (Itemized). Price and variable costs for the two services are listed below. Sales price (per return) Variable costs (per return) Standard $ 140.00 100.00 Itemized $ 430.00 210.00 The annual fixed costs at Grixdale are $420,000. Based on experience, the owner estimates that Standard Deduction returns represent 25 percent of the the firm's business. Required: How many Standard Deduction and Itemized Deduction returns must be filed annually to break even? Standard Deduction returns Itemized Deduction returns Break-Even Sales in Units
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