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In 2019, X Companys profit function was 0.37R - $85,500, where R is revenue. In 2020, the relationship between revenue and v

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Answer #1

Contribution MArgin ration = 0.37 = 37%

Fixed cost = 85,500-17,100 =$68,400

NEt income to Earn = 46,400

Net operating income Must earn = Netincome /(1-Tax) = 46,400 /(1-40%) = 77,333.33

Sales Revenue = (Fixed cost + Net operting income ) / CM ratio

= (68,400+77,333.00)/37% = $393,873.87 =$393,874 (Answer)

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