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Sheridan Footwear Co. produces high-quality shoes. To prepare for next year's marketing campaign, the company's controller has prepared the following information for the current year,
Sheridan Footwear Co. produces high-quality shoes. To prepare for next year's marketing campaign, the company's controller has prepared the following information for the current year, 2022: Variable costs (per pair of shoes) Direct materials $43 Direct manufacturing labour 22 Variable overhead (manufacturing, marketing, distribution, customer service, and administration) 22 Total variable costs $87 Fixed costs Manufacturing $2,550,000 Marketing, distribution, and customer service 480,000 Administrative 775,000 Total fixed costs $3,805,000 $187 Selling price per pair of shoes Expected revenues, 2022 (50,100 units) $9,368,700 Income tax rate 40% (a) Calculate the projected operating income before tax for 2022. Operating income before tax $ Save for Later Attempts: 0 of 2 used Submit Answer (b) Calculate the break-even point in units for 2022. Break-even point units Save for Later Attempts: 0 of 2 used Submit Answer * Your answer is incorrect. The company controller has set the revenue target for 2023 at $10,453,300 (or 55,900 pairs). He believes an additional marketing cost of $401,000 for advertising in 2023, with all other costs remaining constant, will be necessary to attain the revenue target. Calculate the operating income for 2023 if the additional $401,000 is spent and the revenue target is met. Operating income 830400
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