James Corporation gathered the following information:
$$\begin{array} { l r }
\text { Variable costs } & \$ 550,000 \
\text { Income taxrate } & 40 \% \
\text { Contribution-margin ratio } & 30 \%
\end{array}$$ Required:
a.Compute total fixed costs assuming a breakeven volume in dollars of $2,000,000.
b.Compute sales volume in dollars to produce an after-tax net income of $150,000.

Question

James Corporation gathered the following information:
 $$\begin{array} { l r } 
\text { Variable costs } & \$ 550,000 \
\text { Income taxrate } & 40 \% \
\text { Contribution-margin ratio } & 30 \%
\end{array}$$ Required:
a.Compute total fixed costs assuming a breakeven volume in dollars of $2,000,000.
b.Compute sales volume in dollars to produce an after-tax net income of $150,000.

Quizplus · Accepted Answer

The Answer of James Corporation gathered the following information:
 $$\begin{array} { l r } 
\text { Variable costs } & \$ 550,000 \
\text { Income taxrate } & 40 \% \
\text { Contribution-margin ratio } & 30 \%
\end{array}$$ Required:
a.Compute total fixed costs assuming a breakeven volume in dollars of $2,000,000.
b.Compute sales volume in dollars to produce an after-tax net income of $150,000.

James Corporation Gathered the Following Information Required: A

James Corporation Gathered the Following Information Required:
A