Young Corporation Has Determined the Contribution Margin Ratio Is 35

question 109

Essay

Young Corporation has determined the contribution margin ratio is 35% and the income tax rate is 40%.
Required:
A)Assume break-even volume in dollars is $1,500,000.What are total fixed costs?
B)Assume Young Corporation wants after-tax net income of $300,000.What volume of sales in dollars is necessary to achieve this net income?

• A)Assume break-even volume in dollars is $1,500,000.What are total fixed costs?
• B)Assume Young Corporation wants after-tax net income of $300,000.What volume of sales in dollars is necessary to achieve this net income?

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Definitions:

Commerce Clause

A provision in the United States Constitution that grants Congress the power to regulate trade between states, foreign nations, and Indian tribes, forming the basis for much federal legislation on economic regulation.

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The principle that federal law takes precedence over state laws and constitutions when they are in conflict, based on the Supremacy Clause of the U.S. Constitution.

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