How many units of product b must sell if sales mix remains

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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?

Reference no: EM132654895

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