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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