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Power Grid Engineering Associates, Inc._CVP Analysis

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Question

Question;Exercise 7-33;Power Grid;Engineering Associates, Inc. provides consulting services to commercial;electric utilities. The consulting firm?s contribution-margin ratio is 15% and;its annual fixed expenses are $285,000. The firm?s income tax rate is 30%.;Required;1. Calculate the firm?s break-even volume of;service revenue.;2. How much before tax income must the firm;earn to make an after tax net income of $154,000?;3. What;level of revenue for consulting services must the firm generate to earn an;after tax net income of $154,000?

 

Paper#37277 | Written in 18-Jul-2015

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