Problemodd wallow drinks is considering adding a new line, Ask an Expert

Accounting

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Odd Wallow Drinks is considering adding a new line of fruit juices to its merchandise products. This line of juices has the following prices and costs:

Selling price per case (24 bottles) of juice $ 84
Variable cost per case (24 bottles) of juice $ 44
Fixed costs per year associated with this product $ 12,560,000
Income tax rate 40 %

a. Compute Odd Wallow Drinks's break-even point in units per year.

b. How many cases must Odd Wallow Drinks sell to earn $1,884,000 per year after taxes on the juice?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92770423

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