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Question Description

just wanted to make sure with my work

Ibrahim Corporation manufactures product A.Following is information for next year’s operations, based on an estimated volume of 40,000 units:

Expected revenues$2,000,000

Unit costs:

Direct materials$7

Direct labor16

Variable overhead6

Fixed manufacturing overhead3

Total$32

Other fixed costs:

Administration, marketing, etc.$230,000

Income tax rate30%

a.What is the breakeven point for next year?

b.What is next year’s projected after-tax income?

c.Chose a target after-tax income.Estimate the number of units that must be sold to reach this target.

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