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Question - Carter Manufacturing Company manufactures exclusive pens which sell for $67 per unit. Its unit variable costs are $42 and fixed expenses are $387,500. The company pays income tax at the rate of 20%.
Required -
1. How many units must Carter sell to earn an after-tax income of $23,800?
2. Re-compute the sales level to earn the above-mentioned after-tax income if the tax rate changes to 30%.
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