(Break-even point and selling price) Specialty Steel, Inc. will manufacture and sell 230,000 units next year. Fixed costs will total $320,000, and variable costs will be 50 percent of sales. a. The firm wants to achieve a level of earnings before interest and taxes of $270,000. What selling price per unit is necessary to achieve this result? b. Set up a pro forma income statement to verify your solution to part a. a. What selling price per unit is necessary to achieve a level of earnings before interest and taxes of $270,000? (Round to three decimal places.)
(Break-even point and selling price) Specialty Steel, Inc. will manufacture and sell 230,000 units next year. Fixed costs will total $320,000, and variable costs will be 50 percent of sales. a. The firm wants to achieve a level of earnings before interest and taxes of $270,000. What selling price per unit is necessary to achieve this result? b. Set up a pro forma income statement to verify your solution to part a. a. What selling price per unit is necessary to achieve a level of earnings before interest and taxes of $270,000? (Round to three decimal places.)
Chapter4A: Nopat Breakeven: Revenues Needed To Cover Total Operating Costs
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