Question
The following data refers to a single product, the TECHWIZ, made by the Markdata Computer Company:$ Sales price 5,595 Materials cost (including purchased component) 899
The following data refers to a single product, the TECHWIZ, made by the Markdata Computer Company:$
Sales price 5,595
Materials cost (including purchased component) 899
Direct labour cost 233
Facilities cost (for a highly automated plant mainly includesrent, insurance, taxes and depreciation) 2,352,000
Required:
(a) What is the unit contribution margin?
(b) What is the breakeven point in units and dollars?
(c) What is the desired level of sales if the company plans to increase fixed costs by 5 percent (to improve product quality and appearance) and achieve a desired after-tax profit of $200,000?(Assume tax rate to be 22%)
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Accounting concepts and applications
Authors: Albrecht Stice, Stice Swain
11th Edition
978-0538750196, 538745487, 538750197, 978-0538745482
