Graybill Corporation Gathered the Following Information Required:
A

Essay

Graybill Corporation gathered the following information: $\begin{array}{ll}\text { Variable costs } & \$ 945,000 \\\text { Income tax rate } & 40 \% \\\text { Contribution- margin } & 25 \% \\\text { ratio } &\end{array}$ Required:
a. Compute total fixed costs assuming a break- even volume in dollars of $1,610,000.
b. Compute sales volume in dollars to produce an after- tax net income of $210,000.