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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 | $ | 50 | ||
| Variable cost per case (24 bottles) of juice | $ | 24 | ||
| Fixed costs per year associated with this product | $ | 8,150,000 | ||
| Income tax rate | 40 | % | ||
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| Required: |
| (a) |
Compute Odd Wallow Drinks’s break even point in units per year. (Round up your answer to the nearest whole unit.) |
| (b) |
How many cases must Odd Wallow Drinks sell to earn $1,800,000 per year after taxes on the juice?(Round up your answer to the nearest whole number.)
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