Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

Mountain Top Boot Company plans to expand its manufacturing capacity to allow up to 20,000 pairs of a new product each year. Because only one product can be produced, management is deciding between the production of the Sure Foot for backpacking and the Trail Runner for exercising. A marketing analysis indicates mountain top could sell between 8,000 and 14,000 pairs of either product. The accounting department has developed the following price and cost information:

selling price per pair..............sure foot=$80.00 trail runner=$75.00
variable costs per pair...........sure foot=$50.00 trail runner=$50.00
product costs..........................sure foot=$130,000.00 trail runner=$50,000.00

Facility costs for expansion, regardless of product, are $150,000. Mountain Top is subject to a 40% income tax rate.

a. Determine the number of pairs of Sure Foot boots Mountain Top must sell to obtain an after tax profit of $30,000.

b. Determine the number of pairs of each product Mountain Top must sell to obtain identical before tax profit.

c. for the solution to requirement b, find out Mountain Top's after-tax profit or loss.

d. Which product should Mountain Top produce if both products were guaranteed to sell at least 13,000 pairs. Verify your solution with calculations.

e. how much would the variable costs per pair of the product NOT selected in requirement d have to fall before both products provide the same profit at sales of 13,000 pairs? Verify your solution with calculations.

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M941509

Have any Question? 


Related Questions in Accounting Basics

Abc stock has a share price of 150 today all rates of

ABC stock has a share price of $150 today. All rates of interest are 3% per annum on a continuously compounded basis. A one-year European call option on one share of stock struck at $147 is worth $15. Finally, ABC is sch ...

The purpose of an assignment is to ensure that the learner

The purpose of an assignment is to ensure that the Learner is able to: - Demonstrate an understanding of accounting principles. - Systematically record the financial aspects of business transactions. - Prepare financial ...

Assignment question 1 -impulse pty ltd impulse is an

Assignment Question 1 - Impulse Pty Ltd (Impulse) is an entertainment system manufacturer that was established in 2005. Your audit firm King & Queen have been the auditor of Impulse since its formation. The audit report ...

Q1 what was the logic behind the gentiles who asked for

Q.1 what was the logic behind the gentiles who asked for chanja Finkelsztjains world goods( and similar anecdotes) Q.2 how does the author regard the plundering of the Jews? Q.3 Why did so many Jews leave valuables with ...

This is a group work and i entitle do the cash flow

This is a group work and I entitle do the cash flow analysis for Home Depot. Please no more than two pages. Assume that your Group has been hired to serve as my new Investment Advisory Team. I am looking for new investme ...

1 identify which of the following statements is truea a

1. Identify which of the following statements is true. A. A partnership exists as long as there are at least two individuals or entities engaged in the active conduct of a trade or business or a financial operation, and ...

Assessment - written report - individual assessment purpose

Assessment - Written Report - individual assessment Purpose: This assessment is designed to reinforce the subject content and develop students' skills and application of knowledge of the subject content to business situa ...

You are starting your own internet business you decide to

You are starting your own Internet business. You decide to form a company that will sell cookbooks online. Justcookbooks.com is scheduled to launch 6 months from today. You estimate that the annual cost of this business ...

Accounting for gov amp not for profit1 explain in 2-4

ACCOUNTING FOR GOV & NOT FOR PROFIT 1. Explain in 2-4 sentences the difference between government Agency funds and Fiduciary funds. 2. What information is or is not required to be reported in the RSI for pension plans un ...

Assignmentaccounting is the study of how businesses track

Assignment Accounting is the study of how businesses track their income and assets over time. Accountants engage in a wide variety of activities besides preparing financial statements and recording business transactions. ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen