5. Jasper’s Flooring makes three types of flooring products: tile, carpet, and parquet. Cost analysis reveals the following costs (expressed on a per-square-yard basis) are expected for 2016
TILE CARPET PARQUET
Direct materials $5.20 $3.25 $8.80
Direct labor 1.80 .40 6.40
Variable overhead 1.00 .15 1.75
Variable selling expenses .50 .25 2.00
Variable administrative expenses .20 .10 .30
Fixed overhead $760,000
Fixed selling expenses 240,000
Fixed administrative expenses 200,000
Per-yard expected selling prices are: tile, $16.40, carpet, $8.00; and parquet $25.00.
In 2015 sales were as follows and the mix is expected to continue in 2016.
TILE CARPET PARQUET
Square yards 24,000 144,000 12,000
Review of recent tax returns reveals an expected tax rate of 40 percent.
Required:
How many square yards of each product are expected to be sold at the breakeven point?
Assume that the company desires an after-tax profit of $680,000. How many square yards of each type of product would need to be sold to generate this profit level? How much revenue would be required?

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