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The Delta Steel Company has just completed their break-even analysis for the next fiscal year....

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Accounting

The Delta Steel Company has just completed their break-even analysis for the next fiscal year. They are unsure of how much income taxes they must pay if sales increase by 20%. With the 20% increase they will just break-even. Advise the company accordingly and select the one correct answer below.

A.

They have nothing to worry about, since there are no income taxes at the

break-even point.

B.

They should also expect a 20% increase in income taxes due and payable.
C.

None of the above.
D.

Try to find a buyer for the company before anyone finds out they are not

making a profit.
E.

The should try to seek governmental relief from any increase in income

taxes, since they are struggling.

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