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The Robinson Lawn Chair Company produces and sells a single high-priced lawn chair and in fiscal 1999 the company produced :and sold 30,000 units. The
The Robinson Lawn Chair Company produces and sells a single high-priced lawn chair and in fiscal 1999 the company produced :and sold 30,000 units. The 1999 income statement of the company reported the following Robinson Lawn Chair Company Income Statement For Fiscal Year 1999 Per Unit Total $'s 60 $1,800,000 45 $1,350,000 15 450,000 8 240,000 7 210,000 2.1 4.9 63,000 147,000 Sales Variable Costs Contribution Margin Fixed Costs Income before Taxes Tax Expense Income After Taxes .Compute the breakeven point in units for fiscal 1999(1 .Determine the company's margin of safety in units for fiscal 1999(2 Determine the company's degree of operating leverage at the current level of operations. If the company's sales in units were to(3 ?increase 30%, how much would profits before taxes increase in percentage terms? percentage terms .Compute the sales level required in units to achieve a level of profits before taxes of $270,000(4 Based on the original data above, determine the sales level required if the company desires a profit after taxes of $210,000. It is(5 .believed that the tax rate will remain at current levels
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