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A company sells 800 units at $16 each, has variable costs of $12 per unit, and fixed costs of $1,200. Income is $

Sagot :

Assuming a company sells 800 units at $16 each, has variable costs of $12 per unit. The after-tax income is $1,200.

After-tax income

Using this formula

After-tax income=(Selling units×Selling price)-[(Variable costs×Selling price)+Fixed costs]×(1- tax rate)

Let plug in the formula

After-tax income=(800 units× $16 each)-[(800 units × $12 each)+$1200]×(1-.40)

After-tax income=$12,800-($9,600+$1,200)×0.60

After-tax income=$12,800-$10,800×0.60

After-tax income=$2,000×0.60

After-tax income=$1,200

Inconclusion the after-tax income is $1,200.

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