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Laila company has provided the following information about the company Sales $225,000 Sales Discount $20,000...

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Accounting

Laila company has provided the following information about the company Sales $225,000 Sales Discount $20,000 Overhead cost (Fixed) $ 35,000 Overhead (Variable) $ 20,000 Sales Return /Allowance $2,500 Selling commission [variable ] $ 39,600 Supplies $2,600 Selling commission [fixed] $ 15,000 Prepaid expense $11,000 Variable admin expenses $ 24500 Accrued cost $7900 Fixed admin expenses $ 20,000 Tax 25% Interest expenses $5,420 Capacity of production 4,000 units Units sold 3,500 Units produced 3,500 Hint : all selling and admin costs are operating expenses

REQUIRED 9. Determine sales revenue necessary to generate after-tax profit of $85,000 . 10. Calculate degree of leverage [DOL] and if sales increases by 25%, what will be the increase or decrease in net income in $ of this company? What will be the total net income if the project is accepted [use original data in the beginning]

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