Question

Management anticipates fixed costs of $74,300 and variable costs equal to 34% of sales. What will pretax income equal if sales are $343,000?

Answer 1

pretax income is $152080

Step-by-step explanation:

given data

fixed costs = $74300

variable costs = 34%

sales = $343000

to find out

pretax income

solution

we know that pretax income formula is

pretax income = sales - variable costs - fixed costs

put all these value

pretax income = 343000 - 34% of 343000 - 74300

pretax income = 343000 - 116620 - 74300

pretax income = 152080

so pretax income is $152080