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Reliable Furniture manufactures recliners selling for $500 each. Variable costs per unit are $175 for direct material, $125 for direct labor, and $50 for variable
Reliable Furniture manufactures recliners selling for $500 each. Variable costs per unit are $175 for direct material, $125 for direct labor, and $50 for variable overhead. Fixed costs are $300,000 for selling and administrative costs. The company wants to earn an after-tax profit of $120,000. Reliables tax rate is 40%. How many recliners must be sold to accomplish managements objective?
a. 1,000 units
b. 1,334 units
c. 2,800 units
d. 3,334 units
e. 4,000 units
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