please explain how you got your answer AS QUESTION 2 Not complete Points out of

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please explain how you got your answer

AS QUESTION 2 Not complete Points out of 3.00 P Flag question Cost-Volume Profit Analysis Hailstorm Company sells a single product for $22 per unit. Variable costs are $14 per unit and fixed costs are $55,000 at an operating level of 7,000 to 12,000 units. a. What is Hailstorm Company's break-even point in units? Fini 0 units b. How many units must be sold to earn $12,000 before income tax? 0 units c. How many units must be sold to earn $13,000 after income tax, assuming a 35% tax rate? 0 units Check Next page Previous page Save Answers

Explanation / Answer

a) Break even point = fixed cost/contribution margin per unit

= 55000/(22-14)

Break even point = 6875 units

b) Required units = (FIxed cost+profit)/Contribution margin per unit

= (55000+12000)/(22-14)

Required units = 8375 units

c) Income after tax = 13000

Income before tax = 13000*100/65 = 20000

Required units = (55000+20000)/8 = 9375 units

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