Company produces and sells two products: a and b in the ratio 3a to 5b. Selling prices for a and b are respectively, $1,200 and $240; respective costs are $480 $160. The company fixed costs are $1,800,000 per year. Compute the volume of sales in units of each product needed to:

Required:

a. Break even

b. Earn $800,000 of income after income taxes, assuming a 30 percent tax rate.

c. Earn 12 percent on sales revenue in before-tax income.

d. Earn 12 percent on sales revenue in after-tax income, assuming a 30 percent tax rate.

Answer rating: 100% (QA)

a A SP 1200 B SP 240 VC 480 VC 160 CM 720 CM 80 Weighted CM 3 720 5 80 2560 A 1800000 703125 A ... View the full answer