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Carter Company earned net income of $350,000 last year. This year it wants to earn...

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Question

Accounting

Carter Company earned net income of $350,000 last year. This year it wants to earn net income of $450,000. The company's fixed costs are expected to be $300,000, and variable costs are expected to be 70% of sales.

Instructions

(a) Determine the required sales to meet the target net income of $450,000 using the mathematical equation.

(b) Using a CVP income statement format, prove your answer.

Answer & Explanation Solved by verified expert
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