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Oriole sells T-shirts imprinted with high school names and logos. Last year the shirts sold for $24.00 each, and variable costs were $9.00 per shirt.
Oriole sells T-shirts imprinted with high school names and logos. Last year the shirts sold for $24.00 each, and variable costs were $9.00 per shirt. At this cost structure, the breakeven point was 29,000 shirts. However, the company actually earned $21,600 in net income. This year, the company is increasing its price to $26 per shirt. Variable costs per shirt will increase by 20%, and fixed expenses will increase by $36,200. The tax rate will remain at 40%. (a)
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