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I cannot figure out Parts D and E. I've been working on it for days now. I thought I had it right, but apparently not.
I cannot figure out Parts D and E. I've been working on it for days now. I thought I had it right, but apparently not. I've also looked at other people's answers and they got the same thing as me. Maybe it's a flaw in the system?
For Part D I got: 1,559,015 (which is wrong)
For Part E I got two parts right which is the fixed cost and the net income after taxes.
Please help me. This is due tomorrow
Multiple Product Planning with Taxes In the year 2008, Wiggins Processing Company had the following contribution income statement: WIGGINS PROCESSING COMPANY Contribution Income Statement For the Year 2008 Sales $1,000,000 Variable costs Cost of goods sold Selling and administrative $460,000 200,000 Contribution margin (660,000) 340,000 Fixed Costs Factory overhead Selling and administrative Before-tax profit 192,000 80,000 (272,000) 68,000 Income taxes (38%) (25,840) After-tax profit $42,160 HINT: Round the contribution margin ratio to two decimal places for your calculations below. (a) Determine the annual breakeven point in sales dollars. $Answer 800000 (b) Determine the annual margin of safety in sales dollars. $Answer 200000 (c) What is the break-even point in sales dollars if management makes a decision that increases fixed costs by $34,000? Answer 900000 (d) With the current cost structure, including fixed costs of $272,000, what dollar sales volume is required to provide an after-tax net income of $160,000? Do not round until your final answer. Round your answer to the nearest dollar. $Answer 0 (e) Prepare an abbreviated contribution income statement to verify that the solution to part (d) will provide the desired after-tax income. Round your answers to the nearest dollar. Use rounded answers for subsequent calculations. Do not use negative signs with any of your answers. WIGGINS PROCESSING COMPANY Income Statement For the Year 2008 $Answer 0 Sales Answer 0 Variable costs (66% of sales) Answer 530065 Contribution margin Answer 272000 Fixed costs Net income before taxes Answer 0 WIGGINS PROCESSING COMPANY Income Statement For the Year 2008 Answer 0 Income taxes (38%) $Answer 160000 Net income after taxesStep by Step Solution
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