Designer Jackets, Inc. produces blazers and has the following data available on these products. Sales price...

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Designer Jackets, Inc. produces blazers and has the following data available on these products. Sales price...

Designer Jackets, Inc. produces blazers and has the following data available on these products.

Sales price per unit	$ 280
Variable cost per unit	120
Fixed costs per month	16,000
Tax rate	20 percent

(1) How many units must be sold to earn a monthly profit of $150,000 after taxes?
(2) How many sales dollars are required to earn a monthly profit of $150,000 after taxes?

business accounting

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Answer 1

Answer #1

Answer :

1) 1,272 (or) 1271.875 Units

2) $ 356,125

Contribution Margin = Selling Price - Vara ible cost = 280-120 = 160

CM ratio = 160/280 = 57.14%

Units Required to Get the $150,000 After Tax Profit

= (Fixed cost +( ( Profit )/ (1-Tax) ) / Contribution MArgin = ((16,000+(150000/(1-20%)) / 160 = 1271.875 Units (Answer)

Dollars Required = 1,271.875*280 = $ 356,125 (Answer)

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Answer 2

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Designer Jackets, Inc. produces blazers and has the following data available on these products. Sales price...

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