Jacobs Corp. earned net income of $100,000 during 2009. The corporation wants to earn net income of $25,000 more during 2010. The company's fixed costs have been and are expected to remain at $50,000. Variable costs have also maintained stability at 25% of sales; this rate is expected to continue into 2010. Daniels, Inc. sells watches for $50 each.
Instructions:
a) Compute the break even dollars in 2010 (show all your work)
b) Compute the required sales to meet the target net income during 2010. (show all your work)