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Unit price and EBIT.

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The Clearwater Aquarium Company will produce 66,000 10-gallon aquariums next year. Variable costs are 40% of sales while fixed costs total $133,200. At what price must each aquarium be sold for Clearwater to obtain an EBIT of $114,000?

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Solution Summary

This solution is comprised of a step-by-step calculation of the unit price required to meet a certain level of Earnings Before Interest and Taxes (EBIT).

Solution Preview

Using the format from income statement, we have:

Sales Less cost = EBIT

Therefore, we have

Sales ...

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