Reference no: EM133091594
Question - Greenwald limited manufactures a variety of consumer products, including handsoaps and UV sanitizers. Based on an monthly volume of 10000 units, the predicted cost per unit of an UV sanitizer follows.
Direct materials $13.50
Direct labor $3.50
Factory overhead $9.50
Total $26.50
These cost predictions include $15000 in facility-level fixed factory overhead averaged over 10000 units.
In addition to facility-level fixed factory overhead, monthly fixed selling and administrative cost totals $26,000.
UV sanitizers are currently sold at $50 per unit.
Required -
(a) What is the unit contribution margin of UV sanitizer?
(b) How many units of air purifiers should Greenwald sell to at least break-even in a month?
(c) Assuming an income tax rate of 20 percent, what dollar sales volume is currently required to obtain an after-tax profit of $4,000?
(d) In the absence of income taxes, what sales volume in dollar amount will provide the same profit of $4000?