tsmith86
Nov 1, 2005, 05:58 PM
Can someone please help me with the following problem.
-Martha Products, Inc. desires to earn an after-tax income of $250,000. It has fixed costs of $1,000,000, a unit sales price of $500, and unit variable costs of $200. The company is in the 30% tax bracket.
1. How many dollars of sales revenue must be earned to achieve the after-tax profit of $250,000?
2. How many dollars of revenue would have to be earned to achieve the $250,000 of profit, if there had been no income tax?
-Martha Products, Inc. desires to earn an after-tax income of $250,000. It has fixed costs of $1,000,000, a unit sales price of $500, and unit variable costs of $200. The company is in the 30% tax bracket.
1. How many dollars of sales revenue must be earned to achieve the after-tax profit of $250,000?
2. How many dollars of revenue would have to be earned to achieve the $250,000 of profit, if there had been no income tax?