Question: Total fixed cost = $66,000 Selling price per unit = $14 Variable costs per unit = $6 Net target income (after tax) = $52,000 Tax

Total fixed cost = $66,000

Selling price per unit = $14

Variable costs per unit = $6

Net target income (after tax) = $52,000

Tax rate = 35%.

a)Calculate break even point in units

b) calculate the sales revenue (in dollars) required to achieve the target income

c) calculate the difference in operating income when one extra unit is sold

d) if fixed cost increased by 20%, what is the new unit contribution margin required to maintain the same break-even point as before the increase in fixed costs?

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