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Grouper Tax Services provides primarily two lines of service: accounting compilation and tax return preparation. Accounting compilation services represent 60% of its revenue and provide
Grouper Tax Services provides primarily two lines of service: accounting compilation and tax return preparation. Accounting compilation services represent 60% of its revenue and provide a contribution margin ratio of 30%. Tax return preparation services represent 40% of its revenue and provide a 40% contribution margin ratio. The company's fixed costs are $4,222,800. Calculate the revenue from each type of service that the company must achieve to break even. Revenue Accounting $ Tax The company has a desired net income of $1,564,000. What amount of revenue would Grouper earn from tax return preparation services if it achieves this goal with the current sales mix? Tax $ eTextbook and Media
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