The Millennium Company produces two types of products: Quality and Superior. The company expects to sell 1,200 units of Quality and 800 units of Superior.
A projected income statement for the firm as a whole follows: Required:
a.
Determine the break-even point in terms of sales revenue.
b.
Determine the sales revenue necessary to generate a before-tax profit of £300,000.
c.
Determine the sales revenue necessary to generate an after-tax profit of £270,000 if the tax rate is 40 per cent.

Question

The Millennium Company produces two types of products: Quality and Superior. The company expects to sell 1,200 units of Quality and 800 units of Superior.
A projected income statement for the firm as a whole follows:  Required: 
a.
Determine the break-even point in terms of sales revenue.
b.
Determine the sales revenue necessary to generate a before-tax profit of £300,000.
c.
Determine the sales revenue necessary to generate an after-tax profit of £270,000 if the tax rate is 40 per cent.

Quizplus · Accepted Answer

The Answer of The Millennium Company produces two types of products: Quality and Superior. The company expects to sell 1,200 units of Quality and 800 units of Superior.
A projected income statement for the firm as a whole follows:  Required: 
a.
Determine the break-even point in terms of sales revenue.
b.
Determine the sales revenue necessary to generate a before-tax profit of £300,000.
c.
Determine the sales revenue necessary to generate an after-tax profit of £270,000 if the tax rate is 40 per cent.

The Millennium Company Produces Two Types of Products: Quality and Superior