Harrison Inc.has a contribution margin ratio of 60% and fixed costs of $91 000.
Required:
A. If Harrison ignores income taxes, what do sales dollars need to be in order to have net income of $ \$ 500000 $ ?

B. If Harrison takes into account income taxes, and the company is in the $ 40 \% $ tax bracket, what do sales dollars need to be in order to have an after-tax net income of $ \$ 500000 $ ?

Question

Harrison Inc.has a contribution margin ratio of 60% and fixed costs of $91 000.
Required:
A. If Harrison ignores income taxes, what do sales dollars need to be in order to have net income of $ \$ 500000 $ ?

B. If Harrison takes into account income taxes, and the company is in the $ 40 \% $ tax bracket, what do sales dollars need to be in order to have an after-tax net income of $ \$ 500000 $ ?

Quizplus · Accepted Answer

The Answer of Harrison Inc.has a contribution margin ratio of 60% and fixed costs of $91 000.
Required:
A. If Harrison ignores income taxes, what do sales dollars need to be in order to have net income of $ \$ 500000 $ ?

B. If Harrison takes into account income taxes, and the company is in the $ 40 \% $ tax bracket, what do sales dollars need to be in order to have an after-tax net income of $ \$ 500000 $ ?

Harrison Inc $500000 \$ 500000 $500000 ? B 40% 40 \% 40%

Harrison Inc $\$ 500000$ ?

B $40 \%$