Maxie Pty Ltd Makes and Sells Two Types of Shoes

question 98

Multiple Choice

Maxie Pty Ltd makes and sells two types of shoes, Plain and Fancy. Product data is as follows:
Sixty per cent of the sales in units are Plain and annual fixed expenses are $45 000 and the sales mix remains constant. Assume an income tax rate of 20 per cent.
How many units of Plain must Maxie Pty Ltd sell to earn an after tax profit of $18 000?

• A) 4500
• B) 7875
• C) 3960
• D) 8437

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Definitions:

Inulin

A type of soluble fiber found in various plants, used as a dietary fiber and sometimes for testing kidney function.

ADH

Antidiuretic Hormone, a hormone that helps regulate water balance in the body by increasing water reabsorption in the kidneys.

Urinary Bladder

The urinary bladder is a hollow muscular organ that stores urine from the kidneys before disposal by urination.

500 mL

A volume measurement often referencing the typical amount of blood pumped by the left ventricle of the heart in one minute, or the capacity of a standard drink bottle.