XYZ Inc. sell Product Y at P5 per unit. The variable costs of making and selling...

XYZ Inc. sell Product Y at P5 per unit. The variable costs of making and selling each unit is P3 while the total fixed cost is P2,000. The company wants to earn a profit of P3,000. The company is subject to 40% tax rate.

What is the break-even point in units and pesos?
What should be the level of sales in units and pesos to earn the desired profit if it is before tax?
What should be the level of sales in units and pesos to earn the desired profit if it is after tax?
What is the Margin of Safety for the target sales computed in requirement 3 in units, pesos, and percentage?

Expert Solution

ekkarill92 answered 1 year ago

XYZ Inc. sell Product Y at P5 per unit. The variable costs ofmaking and selling...

XYZ Inc. sell Product Y at P5 per unit. The variable costs of making and selling each unit is P3 while the total fixed cost is P2,000. The company wants to earn a profit of P3,000. The company is subject to 40% tax rate.What is the break-even point in units and pesos?What should be the level of sales in units and pesos to earn the desired profit if it is before tax?What should be the level of sales in units...

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XYZ Inc. sell Product Y at P5 per unit. The variable costs of making and selling...

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