Toys 4 Us sells miniature drones for hobbyists for a price of $40. The variable cost for each drone is $9. The fixed costs associated with the drone amount to $105,400 per year.
Required: a. Compute the break-even point in units for the drone.
b. Assuming that the tax rate is 36 percent and the desired profit level is $158,720 after tax, compute the required unit sales level.