The lanier company incurs 60,000 of annual fixed costs in manufacturing and selling a product that it sells for $15 per unit. The variable costs of manufactuing and selling the product are $9 per unit.
1. Contribution margin per unit $6
Contribution margin ratio is: 40%
Break even point in units is 10,000 units
Break even point in dollars is 150000
2. The Lanier company has 30% income tax rate and its management wants to earn an annual after tac net income of $35000 determine the dollar sales volume that the company must achieve to reach this target income level.
3. Determine the amount of after-tax income that the lanier company would earn from a $420000 sales volume.