All of the following are steps used to find the target profit for companies that incur income taxes except:
A)convert the desired target profit after taxes to target profit before taxes.
B)determine the desired target profit after taxes.
C)convert the desired target profit before taxes to target profit after taxes.
D)use the target profit before taxes to calculate target profit in units or in sales dollars.
E)None of the answer choices is correct.

Question

Quizplus · Accepted Answer

The correct steps for finding the target profit for companies that incur income taxes include determining the desired target profit after taxes, converting this to a before-tax amount, and then using this figure to calculate the target profit in units or sales dollars. Converting the desired target profit before taxes to after taxes (C) is not a step in this process, as the initial goal is to determine how much needs to be earned before taxes to achieve a specific after-tax profit.

All of the Following Are Steps Used to Find the Target