Question: Problem #1- CVP Analysis (16 Points): SHOW ALL WORK Enola, Inc., manufactures a product that sells for $800. Fixed costs are $750,000. The variable costs
Problem #1- CVP Analysis (16 Points): SHOW ALL WORK
Enola, Inc., manufactures a product that sells for $800. Fixed costs are $750,000. The variable costs per unit are as follows:
| Direct materials | $300 |
| Direct labor | 140 |
| Variable manufacturing overhead | 85 |
Required:
| a. | a. Determine the break-even point in units. (Hint: You must compute total variable costs and total fixed costs)
b. Determine the break-even sales dollars |
|
|
|
| c. | Determine the number of units that must be sold to earn $200,000 in profit before taxes. |
| d. | Determine the number of units that must be sold to generate an after-tax profit of $110,000 if there is a 35 percent tax rate. |
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
