Question

# Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs...

Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are \$260,400, and the sales mix is 40% bats and 60% gloves. The unit selling price and the unit variable cost for each product are as follows:

 Products Unit Selling Price Unit Variable Cost Bats \$40 \$30 Gloves 100 60

a. Compute the break-even sales (units) for both products combined.
fill in the blank 1 units

b. How many units of each product, baseball bats and baseball gloves, would be sold at break-even point?

 Baseball bats fill in the blank 2 units Baseball gloves fill in the blank 3 units

a.) Break even point for both product combined = Total Fixed expenses / (Weighted average selling price - weighted average variable expenses)

Weighted average selling price = 40 *.4 + 100 * .6 = 16 + 60 = 76

Weighted average variable cost = 30 * .4 + 60 * .6 = 12 + 36 = 48

Therefore Breakeven sales in units = 260400 / (76 - 48 ) = 9300 units

b.) The number of units of each product to be sold : Bat = 9300 * 40% = 3720 units

Gloves = 9300 * 60% = 5580 units

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