Reference no: EM133180501

Question - The Don Company sold 100,000 units of its product at P 20 per unit. Variable costs are P 14 per unit (manufacturing costs of P11 and marketing costs of P3). Fixed costs are incurred uniformly throughout the year and amount to P 792,000 (manufacturing costs of P500,000 and marketing costs of P 292,000)

Required -

1. Determine the breakeven point in units and pesos.

2. Determine the number of units that must be sold to earn an income of P 60,000 before income tax.

3. Determine the number of units that must be sold to earn an after-tax income of 90,000. The income tax rate is 40%.