Answer the following question(s)using the information below.Stephanie's Bridal Shoppe sells wedding dresses.The average selling price of each dress is $1,000, variable costs are $400, and fixed costs are $90,000.
-How many dresses must the Bridal Shoppe sell to yield after-tax net income of $18,000, assuming the tax rate is 40%?
A)180 dresses
B)170 dresses
C)150 dresses
D)200 dresses
E)270 dresses

Question

Quizplus · Accepted Answer

To find the number of dresses needed to achieve an after-tax net income of $18,000, first calculate the pre-tax income required: $18,000 / (1 - 0.40) = $30,000. Then, use the contribution margin per dress ($1,000 - $400 = $600) to find the break-even point: ($90,000 + $30,000) / $600 = 200 dresses.

Answer the Following Question(s)using the Information Below