Cost-Volume Profit Analysis Hailstorm Company sells a single product for $28 per unit. Variable costs are...

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Cost-Volume Profit Analysis Hailstorm Company sells a single product for $28 per unit. Variable costs are $22 per unit and fi

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Answer 1

Answer #1

a.

Break even point in units

fixed cost/(selling price-variable cost)

$60000/$(28-22)

= 10,000 units

b)
Contribution required = 12000 + 60000	$72,000.00
No of units to be sold = 72000/6	12000 units

c)
Income after tax	$14,500.00
Income before tax required = 14500/(1-35%)	$22,307.69
Contribution required = 22307.69 + 60000	$82,307.69
No of units to be sold = 82307.69/6	13,718 units

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Answer 2

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