Question
In: Accounting
X Company's profit equation next year is expected to be 0.42R-$11,900, where R is total revenue....
X Company's profit equation next year is expected to be 0.42R-$11,900, where R is total revenue. Assuming a tax rate of 34%, what must next year's revenue be in order for X Company to earn after-tax profits of $28,000?
Solutions
Expert Solution
| Profit Equation = | = 0.42 R - $ 11,900 | ||
| Expecting profit in next year = | = $ 28,000 | ||
| Expecting profit befor Tax = | = $ 28,000 X 100 /66 | ||
| Expecting profit befor Tax = | $ 42,424 | ||
| 0.42 R - $ 11,900 = | $ 42,424 | ||
| 0.42 R = $ 42,424 + $ 11,900 | |||
| 0.42 R = | $ 54,324 | ||
| R = = $ 54,324 / 0.42 = | $ 1,29,343 | ||
| Answer = Next Year expected revenue = $ 129,343 | |||
ekkarill92 answered 2 years agoRelated Solutions
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