Generating operating income
Problem:
Moon company sells product Q at $6 a unit. In 2000 fixed costs are expected to be $200,000 and variable cost are estimated at $4 a unit. How many units of Product Q must Moon sell to generate operating income of $40,000?
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Bob and Jane Kelso file a joint tax return. The couple's AGI averages $500,000. Consequently, their total exemption amount is subject to the maximum reduction.
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How would your answer change if there were a fixed charge of $1,000 per year in addition to the variable charge?
How many units of Product Q must Moon sell to generate operating income of $40,000?
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