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Company X manufactures and sells 2 products: Product AA and product BB. The c...
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Company X manufactures and sells 2 products: Product AA and product BB. The company sells these products in bundles, each containing 2 units of AA and 3 units of BB. The following data is available:
Product AA
- selling price: $25/unit
- variable cost: $20/unit
Product BB
- selling price: $45/unit
- variable cost: $35/unit
Other costs:
- Fixed manufacturing cost: $250000
- Fixed general cost: $150000
- Income taxes at a rate of 25%
The company has a target after tax net income of $300000. How many bundles does the company need to sell in order to achieve this target?
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