Extensions of the CVP Model—Taxes
Lomas Electronics manufactures a portable testing device for use in oil exploration. The product’s price and cost characteristics are:
|
Selling price per unit |
$ 130 |
|
Variable cost per unit |
70 |
|
Fixed cost per year |
420,000 |
Required
The company must sell 10,000 units annually in order to earn $117,000 in profits after taxes. What is Lomas Electronics’s tax rate?