Aqua system engineering provides consulting services to city water authourity a

Question

Aqua system engineering provides consulting services to city water authourity a recent income statment releaved variable cost of $ 740,000 on a sales level of $ 1,000,000 annual fixed expenses are $ 200,000 and the firm's income tax rate is 35 percent

please answer all spicial B and C

A calculate the break even volum of services revenu

B how much befor tax income must the firm earn to make an after tax net income of $ 100,000

C what level of revenu must firm generate to earn an after tax income of $ 100,000

income tax rate raise to 40 percent what happened to break even point level of consulting revenu

Explanation / Answer

A calculate the break even volum of services revenu

Break Even volume of service revenue = 200,000/260,000* 1000,000 = $769230.77

B how much before tax income  must the firm earn to make an after tax net income of $ 100,000

Befor tax income = 100,000/0.65 = $153846.15

C what level of revenu must firm generate to earn an after  of $ 100,000

Level of revenue = (200,000+153846.15)/260000 * 1000,000 = $1,360,946.75

D suppose the firm's income tax

raise to 40 percent what happened to break even point level of consulting revenu

Break Even point remain same that is The revenue to be earned = $769230.77

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