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he European Division of Worldwide Reference Corporation produces a pocket dictionary containing Break opular phrases in six European languages. Annual budget data for the coming
he European Division of Worldwide Reference Corporation produces a pocket dictionary containing Break opular phrases in six European languages. Annual budget data for the coming year follow. Projected Net I Grap ales are 100,000 books. $1,000,000 (LO Variable s0 $300,000 200,000 00,000 150,000 50,000 Fixed 80 Direct materia Direct labor Manufacturing overhead Selling and administrative... 10,000 $210,000 $700,000 910,000 90,000 Total costs Budgeted operating income Calculate the break-even point in units and in sales dollars. If the European Division is subject to an income-tax rate of 40 percent, compute the number of units the company would have to sell to earn an after-tax profit of $90,000. If fixed costs increased $31,500 with no other cost or revenue factor changing, compute the firm's break-even sales in units. pare a profit-volume graph for the European Division. e to an unstable political situation in the country in which the European Division is located Du a gement believes the country may split into two independent nations. If this happens, the tax rate could rise to 50 percent. Assuming all other data as in the original problem, how many pocket onaries must be sold to earn $90,000 after taxes
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