aventure Manufacturing expects to earn P210,000 next year after taxes. Sales will be P4million. The firm manufactures a combined bookshelf and desk unit used extensively in university dormitories. These units sell for P200 each and a have variable cost per unit of P150. Bonaventure experiences a 30% tax rate. a. Determine the firm’s fixed costs that are expecte

aventure Manufacturing expects to earn P210,000 next year after taxes. Sales will be P4million. The firm manufactures a combined bookshelf and desk unit used extensively in university dormitories. These units sell for P200 each and a have variable cost per unit of P150. Bonaventure experiences a 30% tax rate. a. Determine the firm’s fixed costs that are expecte

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 16E

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Delta Co. sells a product for $150 per unit. The variable cost per unit is $90 and fixed costs are $15,250. Delta Co.s tax rate is 36% and the company wants to earn $44,000 after taxes. What would be Deltas desired pre-tax income? What would be break-even point in units to reach the income goal of $44,000 after taxes? What would be break-even point in sales dollars to reach the income goal of $44000 after taxes? Create a contribution margin income statement to show that the break-even point calculated in B, generates the desired after-tax income.
Bonaventure Manufacturing expects to earn P210,000 next year after taxes. Sales will beP4million. The firm manufactures a combined bookshelf and desk unit used extensively inuniversity dormitories. These units sell for P200 each and a have variable cost per unit of P150.Bonaventure experiences a 30% tax rate.a. Determine the firm’s fixed costs that are expected next year.b. Calculate the firm’s break-even point in both units and pulas.
AZ Humanade, Inc. expects to earn P150,000 next year after taxes on sales of P2,200,000. Stanley manufactures only one product. The firm’s selling price is P8 a piece and with a variable cost of P2.40 a piece. Tax Rate is currently at 34%. REQUIRED: What are the firm’s expected fixed costs for next year? What is the breakeven point in units?
The Body Fit Company sells high-energy bars to supermarkets for P135 per year. Variable cost is P45 per bar and annual fixed costs are P1,440,000. Determine: a. The breakeven point in pesos and units. b. The volume required to eam a before-tax profit of P360,000. The volume required to eam an after 40% tax retum of 15%. The price would be charged to earn a before tax profit of P300,000 if Body Fit Company can sell 30,000 bars. C. d.
A firm has fixed costs of P200,000 and variable costs per unit of P6. It plans on selling 40,000 units in the coming year. If the firm pays income taxes on its income at a rate of 40 percent, what sales price must the firm use to obtain an after-tax profit of P24,000 on the 40,000 units?
Firm M expects to earn $210,000 next year after taxes. Sales will be $4 million. This firm makes combined bookshelf and desk unit for college students. This units sell for $200 each and have a variable cost of $150 per unit. This firm pays 30 percent tax rate on its earnings. Based on the information provided, estimate the firm’s fixed costs expected next year and estimate the firm’s break-even point in units and dollars.
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Pens and Prints manufactures and sells T-shirts imprinted with college names and slogans. Last year, the shirts sold for $7.50 each, and the variable cost to manufacture them was $2.25 per unit. The company needed to sell 20,000 shirts to break-even. The after tax net income last year was $5,040. Donnelly's expectations for the coming year include the following: • The sales price of the T-shirts will be $9• Variable cost to manufacture will increase by one-third • Fixed costs will increase by 10%• The income tax rate of 40% will be unchanged. Sales for the coming year are expected to exceed last year's by 1,000 units. If this occurs, How much will be the sales revenue in the coming year?
A certain factory produces 2000 Ton per year of its product. Th price of one kilogram is 1.8$. The annual direct production cost is 2million $ when the factory works at its whole capacity. Other fixed costs are 7X10^5 b) If the selling price increases by 10% calculate the increase in the net profit at the whole capacity assuming the taxes are 48% of the gross profit.
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A company expects to sell 30,000 units of a product next year. Variable production cost is ₱25 and variable selling costs is 40% of the selling price. Fixed expenses are ₱650,000 per year. The firm set a target profit after tax of ₱250,000. Tax rate is 25%. Based on the information, the unit selling price should be? a. ₱ 62.50 b. ₱ 32.50 c. ₱ 10.00 d. ₱ 38.24 e. ₱ 41.67 f. ₱ 100.00
Dona Corporation manufactures and sells T-shirts imprinted with college name and slogans. Last year, the shirts sold for P7.50 each, and the variable cost to manufacture them was P2.25 per unit. The company needed to sell 20,000 shirts to breakeven. The net income last year was P5,040. Dona’s expectation for the coming year include the following: • The sales price of the t-shirt will be P9.00 • Variable cost to manufacture will increase by one-third. • Fixed cost will increase by 10% • The income tax rate of 40% will be unchanged a. The selling price that would maintain the same contribution margin rate as last year is ______________- b. The number of T-shirts Dona must sell to break even in the coming year is ______________ c. If Dona wishes to earn P22,500 in net income for the coming year, the company’s sales in pesos must be __________