5. (CPV with before-tax profit) Domestic Steel, Inc., manufactures home furnaces that selling for $1,000. The unit costs are :
Direct material $375
Direct labor 250
Variable factory overhead 130
Variable selling expense 45
Annual fixed factory overhead is $100,000 and fixed selling and administrative expenses are $120,000. The company is in a 30 percent tax bracket.
You have been enlisted to determine how many furnaces the company needs to make and sell to earn $140,000 in after-tax profit.