Howe Hinges Co. manufactures and sells a single product. This product has the following operational data:...
Howe Hinges Co. manufactures and sells a single product. This product has the following operational data:
Unit sales price $30, Variable manufacturing cost per unit $17, Fixed manufacturing cost $72000, Variable selling cost per unit $1, Fixed Selling cost $27000, and tax rate 40%.
What amount of total revenue would be needed to meet an after-tax target profit of $48,000?
Homework Answers
Amount of revenue should be $447,500
Working
| Income after tax required | $ 48,000.00 |
| Income tax expense (48000/60 x 40) | $ 32,000.00 |
| Income before tax required (48000/60 x 100) | $ 80,000.00 |
.
| A | Sale Price per unit | $ 30.00 |
| B | Variable Cost per Unit | $ 18.00 |
| C=A x B | Unit Contribution | $ 12.00 |
| D | Total Fixed cost + Desired before tax profit | $ 179,000.00 |
| E=D/C | units to br e sold | 14,917 |
| F= E x A | Sales dollars required | $ 447,500 |
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Howe Hinges Co. manufactures and sells a single product. This
product has the following operational data:...
Howe Hinges Co manufactures and sells a single product. This product has the following operational data:...
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