Strongsville Company Wishes to Earn After-Tax Net Income of $18,000

question 49

Multiple Choice

Strongsville Company wishes to earn after-tax net income of $18,000.Total fixed costs are $84,000, and the contribution margin per unit is $6.00.Strongsville's tax rate is 40%.The number of units that must be sold to earn the targeted net income is _____.

• A)14,000 units
• B)17,000 units
• C)19,000 units
• D)21,500 units

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Definitions:

Combined Turnover

The total revenue generated from all sources by a company or group of companies, without deducting any costs or losses.

Investment Opportunity

A potential venture or avenue through which an investor can put money into assets or projects expecting a favorable financial return.

Combined Return On Investment

A measure assessing the total financial return of different investments or the aggregate performance of an entire investment portfolio.

Contribution Margin Ratio

A financial metric that shows the percentage of sales revenue that exceeds variable costs, contributing to covering fixed costs and generating profit.