Essay
Zippo Inc manufactures digital camera that sell for $240 each.Annual fixed costs total $4,850,000 while variable costs are $92 per unit.The company is subject to a 30% corporate tax and wants to earn an after-tax profit of $975,000.
(a)What is the contribution margin ratio?
(b)What is the breakeven point in sales dollars?
(c)How many pagers must the company sell to reach its after-tax profit goal?
(d)If Zippo increased the selling price of the digital camera by 10%,what would the breakeven point in units be?
Correct Answer:
Verified
(a)$240 - $92 = $148 $148/$240 = .617 co...View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Correct Answer:
Verified
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Q61: Techno Inc manufactures pagers that sell for
Q62: The cost associated with maintaining the manufacturing
Q63: The point where the total revenue line
Q64: Your firm is involved in a make
Q65: Bug-Ez Corporation manufactures one product,Itch-A-Way,which,when applied to
Q67: Match the following terms with the definitions
Q68: Explain why contribution margin is all profit
Q69: If a company decreases its fixed cost
Q70: If selling price per unit increases,how will
Q71: When analyzing the incremental costs used to