Gates Rubber Company sells cases of hydraulic hoses for $80.The unit variable costs per case are $40 plus a selling commission of 10 percent of sales.Fixed manufacturing costs total $1,000 per month, while fixed selling and administrative costs total $2,000.The company has a tax rate of 40%.Required:
a.What is the contribution margin per case?
b.What is the break-even point in cases?
c.How many cases must be sold to earn pre-tax profit of $6,000?
d.How many cases must be sold to earn an after-tax income of $6,000?

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The Answer of Gates Rubber Company sells cases of hydraulic hoses for $80.The unit variable costs per case are $40 plus a selling commission of 10 percent of sales.Fixed manufacturing costs total $1,000 per month, while fixed selling and administrative costs total $2,000.The company has a tax rate of 40%.Required:
a.What is the contribution margin per case?
b.What is the break-even point in cases?
c.How many cases must be sold to earn pre-tax profit of $6,000?
d.How many cases must be sold to earn an after-tax income of $6,000?

Gates Rubber Company Sells Cases of Hydraulic Hoses for $80