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Parks Castings Inc. will manufacture and sell 200,000 units next year. Fixed costs will total $300,000, and variable costs will be 60 percent of sales.

Parks Castings Inc. will manufacture and sell 200,000 units next year. Fixed costs will total $300,000, and variable costs will be 60 percent of sales.

a. The firm wants to achieve a level of earnings before interest and taxes of $300,000. What selling price per unit is necessary to achieve this result?

b. Set up an analytical income statement to verify your solution to part a.

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