Net Income Planning Night Hawk Corporation sells a single product for $150 per unit, of which...
Net Income Planning Night Hawk Corporation sells a single product for $150 per unit, of which $60 is contribution margin. Fixed costs total $240,000 and net income before income tax is $54,000.
Round UP unit answers to the nearest unit, when applicable.
Determine the following
a. The present sales volume in dollars. $Answer
b. The break-even point in units. Answer units
c. The sales volume in units necessary to attain a net income
before income tax of $75,000. Answer units
d. The sales volume in units necessary to attain a net income
before income tax equal to 10% of sales revenue. Answer units
e. The sales volume in units necessary to attain an after-tax net
income of $54,000 if the tax rate is 20%. Answer units
Homework Answers
a) Contribution margin ratio = (150-60)/150 = 60%
Present sales volume in Dollars = (240000+54000)/0.60 = $490000
b) The break even unit = 240000/90 = 2667 Units
c) Required units = (240000+75000)/90 = 3500 Units
d) 150X = 60X+240000+15X
150X = 75X+240000
75X = 240000
X(Units) = 3200 Units
e) Desired income before tax = 54000*100/80 = 67500
Required unit = (240000+67500)/90 = 3417 Units
Add Answer to:
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