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    "question_id": "4240087",
    "url": "\/study-help\/questions\/multiple-product-planning-with-taxes-in-the-year-2008-wiggins-4240087",
    "question_creation_date_js": "2024-06-28T04:39:00-04:00",
    "question_creation_date": "Jun 28, 2024 04:39 AM",
    "meta_title": "[Solved] Multiple Product Planning with Taxes In t | SolutionInn",
    "meta_description": "Answer of - Multiple Product Planning with Taxes In the year 2008, Wiggins Processing Company had the following contribution incom | SolutionInn",
    "meta_keywords": "multiple,product,planning,taxes,year,2008,wiggins,processing,company,contribution,income,statement",
    "question_title_h1": "Multiple Product Planning with Taxes In the year 2008, Wiggins Processing Company had the following contribution income statement: Sales $1,000,000 Variable costs Cost of goods",
    "question_title": "Multiple Product Planning with Taxes In the year 2008, Wiggins Processing Company",
    "question_title_for_js_snippet": "Multiple Product Planning with Taxes In the year 2008, Wiggins Processing Company had the following contribution income statement  Sales $1,000,000 Variable costs Cost of goods sold $440,000 Selling and administrative 200,000 (640,000) Contribution margin 360,000 Fixed Costs Factory overhead 154,000 Selling and administrative 80,000 (234,000) Before tax profit 126,000 Income taxes (39 ) (49,140) After tax profit $76,860 HINT  Round the contribution margin ratioto two decimal places for your calculations below  (a) Determine the annual break even point in sales dollars  $Answer (b) Determine the annual margin of safety in sales dollars  $ Answer (c) What is the break even point in sales dollars if management makes a decision that increases fixed costs by $72,000  Answer (d) With the current cost structure, including fixed costs of $234,000, what dollar sales volume is required to provide an after tax net income of $270,000  Do not round until your final answer  Round your answer to the nearest dollar  $Answer (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 notuse negative signs with any of your answers  Sales $Answer Variable costs (64  of sales) Answer Contribution margin Answer Fixed costs Answer Net income before taxes Answer Income taxes (39 ) Answer Net income after taxes $Answer",
    "question_description": "<p>Multiple Product Planning with Taxes In the year 2008, Wiggins Processing Company had the following contribution income statement:<\/p> <table> <tbody><tr><\/tr><\/tbody> <tbody> <tr> <td>Sales<\/td> <td><\/td> <td>$1,000,000<\/td> <\/tr> <tr> <td>Variable costs<\/td> <td><\/td> <td><\/td> <\/tr> <tr> <td>Cost of goods sold<\/td> <td>$440,000<\/td> <td><\/td> <\/tr> <tr> <td>Selling and administrative<\/td> <td>200,000<\/td> <td>(640,000)<\/td> <\/tr> <tr> <td>Contribution margin<\/td> <td><\/td> <td>360,000<\/td> <\/tr> <tr> <td>Fixed Costs<\/td> <td><\/td> <td><\/td> <\/tr> <tr> <td>Factory overhead<\/td> <td>154,000<\/td> <td><\/td> <\/tr> <tr> <td>Selling and administrative<\/td> <td>80,000<\/td> <td>(234,000)<\/td> <\/tr> <tr> <td>Before-tax profit<\/td> <td><\/td> <td>126,000<\/td> <\/tr> <tr> <td>Income taxes (39%)<\/td> <td><\/td> <td>(49,140)<\/td> <\/tr> <tr> <td>After-tax profit<\/td> <td><\/td> <td>$76,860<\/td> <\/tr> <\/tbody> <\/table> <p> <\/p> <p><\/p> <p><strong>HINT:<\/strong>Round the contribution margin ratioto two decimal places for your calculations below.<\/p> <p>(a) Determine the annual break-even point in sales dollars. $Answer <\/p> <p> <\/p> <p> <\/p> <p>(b) Determine the annual margin of safety in sales dollars.<\/p> <p>$<\/p>Answer<p> <\/p> <p> <\/p> <p>(c) What is the break-even point in sales dollars if management makes a decision that increases fixed costs by $72,000?<\/p>Answer<p> <\/p> <p> <\/p> <p>(d) With the current cost structure, including fixed costs of $234,000, what dollar sales volume is required to provide an after-tax net income of $270,000?<\/p> <p>Do not round until your final answer. Round your answer to the nearest dollar. $Answer <\/p> <p> <\/p> <p> <\/p> <p>(e) Prepare an abbreviated contribution income statement to verify that the solution to part (d) will provide the desired after-tax income.<\/p> <p>Round your answers to the nearest dollar. Use rounded answers for subsequent calculations.Do notuse negative signs with any of your answers.<\/p> <table> <tbody><tr><\/tr><\/tbody> <tbody> <tr> <td>Sales<\/td> <td>$Answer <\/td> <\/tr> <tr> <td>Variable costs (64% of sales)<\/td> <td>Answer <\/td> <\/tr> <tr> <td>Contribution margin<\/td> <td>Answer <\/td> <\/tr> <tr> <td>Fixed costs<\/td> <td>Answer <\/td> <\/tr> <tr> <td>Net income before taxes<\/td> <td>Answer <\/td> <\/tr> <tr> <td>Income taxes (39%)<\/td> <td>Answer <\/td> <\/tr> <tr> <td>Net income after taxes<\/td> <td>$Answer <\/td> <\/tr> <\/tbody> <\/table> <p> <\/p>",
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    "related_book": {
        "title": "Income Tax Fundamentals 2013",
        "isbn": "1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516",
        "edition": "31st Edition",
        "authors": "Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill",
        "cover_image": "https:\/\/dsd5zvtm8ll6.cloudfront.net\/si.question.images\/book_images\/1124.jpg",
        "uri": "\/textbooks\/income-tax-fundamentals-2013-31st-edition-9781285586618",
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        "edition": "1st Edition"
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    "question_posted": "2024-06-28 04:39:00",
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