Delaware manufacturing company sells two products , product A and product B
Product A Product B Total
Selling price $40 $50 ?
Variable cost per unit $24 $40 ?
Total Fixed Cost ? ? $840,000
Delaware manufacturing sells two units of the product A for each unit it sells of product B. Delaware Manufacturing faces a tax rate of 30%.
Required
a) What is the breakeven point in units for each product assuming the sales mix is 2 units of the product A for each unit of product B?
b) What is the breakeven point if Delaware Manufacturing's tax rate is reduced to 25%, assuming the sales mix is 2 units of product A for each unit of product B?
c) How many units of each product would be sold if Delaware Manufacturing desired an after tax net income of $ 73,500, Facing a tax rate of 30%