Reference no: EM132654895
Light Ltd. produces lighting fixtures. For the upcoming period, the company has provided the folowing budget information for two of its product lines:
Product A Product B
Sales (units) 120,000 400,000
Sales $ 6,000,000 $ 48,000,000
Less: variable costs (2,400,000) $(33,000,000 )
Contribution margin $ 3,600,000 10, 000, 000
Less: ?xed costs (2,398,000) (6,200,000)
Operating pro?t (loss) 1,202,000 3,800,000
Problem 1: If Light wishes to achieve a total net (after-tax) income of $7,000,000 and has a tax rate of 30%, how many units of Product B must it sell if the sales mix remains unchanged?