Joan Michaels has a small plant that makes playhouses. She sells them to local customers at $3,000

Question:

Joan Michaels has a small plant that makes playhouses. She sells them to local customers at $3,000 each. Her costs are as follows:

Joan is in a 35 percent tax bracket.
a. How many playhouses must she sell to earn $247,507 after taxes?
b. What level of revenue is needed to yield an after-tax income equal to 20 percent of sales?

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Cost Accounting Traditions and Innovations

ISBN: 978-0324026450

4th edition

Authors: Barfield Jesse, Raiborn Cecily, Kinney Michael

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Question Posted: Dec 27, 2016 08:31 AM

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Joan Michaels has a small plant that makes playhouses. She sells them to local customers at $3,000

Question:

Costs Per Unit Total Direct material Direct labor Variable overhead Variable selling Fixed production overhead Fixed selling and administrative $1,200 20ND 150 50 $200,000 80,420

Step by Step Answer:

a After tax income of 247507 represents only 65 of income before tax Hence the inco...View the full answer

Cost Accounting Traditions and Innovations

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