Reference no: EM133092361

Question - Jack makes electric golf carts, sold for $4,000 each. Relevant cost data are as follows:

Direct materials (per unit) $1,600 Fixed manufacturing overhead (total) $200,000

Direct labor (per unit) 500 Fixed selling expenses (total) 80,420

Variable manufacturing overhead 250

Variable selling costs (per unit) 25

Jack pays income taxes at the rate of 35 percent.

(1) Number of carts that need to be sold to earn $500,000 after tax ___________ carts

(2) Revenue required to yield after tax income of 20% of revenue?

1. Compute the number of carts that need to be sold to earn $500,000 after tax.

2. Determine the revenue at which after tax profit equals 20% of sales.