Marling Machine Works Produces Soft Serve Ice Cream Freezers

question 76

Essay

Marling Machine Works produces soft serve ice cream freezers.The freezers sell for $12,000, and variable costs total $8,200 per unit.Marling incurs $6,840,000 in fixed costs during the year.The company's tax rate is 25%.
Required:
How many freezers must Marling sell to generate net income of $3,450,000?

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Definitions:

Incentive

A factor, either monetary or non-monetary, that motivates individuals or entities to behave in a certain way.

Tax Evasion

The illegal practice of not paying taxes by individuals or businesses through various means, including underreporting income or inflating deductions.

Tax Avoidance

Tax avoidance involves legally planning one's financial affairs to minimize tax liability within the confines of the law.

Consumption Taxes

Taxes imposed on the expenditure on goods and services, such as sales tax or value-added tax (VAT).