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In: Accounting

Flounder Company, which is subject to a 40% income tax rate, projected its income before taxes...

Flounder Company, which is subject to a 40% income tax rate, projected its income before taxes for next year as shown here:

Sales (272,000 units) $13,600,000
Cost of sales
Variable costs 3,400,000
Fixed costs

5,100,000
Pretax earning

$5,100,000

1) If Flounder wants $7,650,000 in pretax earning, what is the required level of sales, in dollars?

2) If Flounder’s net assets are $61,200,000, what amount of revenue must be achieved for Flounder to earn a 10% after-tax return on assets?

3) If Flounder wants after-tax earnings of 30% of sales, what is the required level of sales in dollars and in units?

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ekkarill92 answered 1 year ago
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