Reference no: EM132598014

Question 1: A company wants to earn an income of $60,000 after-taxes. If the tax rate is 32, what must be the company's pre-tax income in order to have $60,000 after-taxes?

a. $88,235

b. $19,200

c. $79,200

d. $143,000

Question 2: A company has pre-tax or operating income of $120,000). If the tax rate is 40 %, what is the company's after-tax income?

a. $300,000

b. $240,000

c. $48,000

d. $72,000

Question 3: When sales price increases and all other variables are held constant, the break-even points will ________.

a. remain unchanged

b. increase

c. decrease

d. produce a lower contribution margin

Question 4: When sales price decreases and all other variables are held constant, the break-even points will ________.

a. remain unchanged

b. increase

c. decrease

d. produce a higher contribution margin

Question 5: When variable costs increase and all other variables remain unchanged, the break-even point wills ________.

a. remain unchanged

b. increase

c. decrease

d. produce a lower contribution margin

Question 6: When fixed costs decrease and all other variables remain unchanged, the break-even point wills ________.

a. remain unchanged

b. increase

c. decrease

d. produce a lower contribution margin

Question 7: When fixed costs increase and all other variables remain unchanged, the contribution margins will ________.

a. remain unchanged

b. increase

c. decrease

d. increase variable costs per unit