Reference no: EM133156705

Question - Tommy's Towels sells three items (which it purchases from a supplier): bath towels, hand towels, and washcloths in a 4:3:2 mix (thus, a batch of 9 towels has 4 bath towels, 3 hand towels, and 2 washcloths). Each bath towel sells for $15 and costs $9, each hand towel sells for $10 and costs $7; and each washcloth sells for $7.50 and costs $6. The shop's annual fixed expenses are $369,000, and the income tax rate, t, is 40%. How many bath towels must the firm sell at the breakeven point?