Response to the following problem:
Bidwell Company Data for the Bidwell Company are as follows:
Sales (100,000 units) $1,000,000
Costs fixed variable Raw material $ 0 $300,000
Direct labor 0 200,000
Factory costs 100,000 150,000
Selling & Admin. 110,000 50,000
Total costs $210,000 $700,000 910,000
Operating income $ 90,000
Required:
1.Based on the preceding data, calculate break-even sales in units.
2.If Bidwell Company is subject to an effective income tax rate of 40 percent, calculate the number of units Bidwell would have to sell to earn an after-tax profit of $90,000.
3.If fixed costs increase $31,500 with no other cost or revenue factors changing, calculate the break-even sales in units.