Austin Automotive sells an auto accessory for $180 per unit. The company’s variable cost per unit is $30 for direct material, $25 per unit for direct labor, and $17 per unit for overhead. Annual fixed production overhead is $82,280, and fixed selling and administrative overhead is $55,528. Assume a tax rate for the company of 30 percent.
If Austin Automotive wants to earn an after-tax profit of $7.20 on each unit sold, how many units must the company sell?
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