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BBC Builders Inc. produces three products: A, B, and C. The following information is presented for...

BBC Builders Inc. produces three products: A, B, and C. The following information is presented for the three products: Calculate the contribution margin for each product Calculate the break-even point in units of the three products A, B, and C combination based on the sales mix percentaage Fixed Cost $321,000 Product A Product B Product C Price Per Unit $40 $34 $20 Variable Cost Per Unit $25 $20 $6 Contribution Margin Per Unit Product Mix 30% 20% 50% 100% Weighted Average Price $12.00 $6.80 $10.00 Weighed Average Cost $7.50 $4.00 $3.00 WA Contribution Margin BE in Units(Roudup to Integer)
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Answer #1
CALCULATION OF CONTRIBUTION MARGIN AND BREAK EVEN POINT IN UNITS
Particulars PRODUCT A PRODUCT B PRODUCT C
Price Per Unit (A) 40 34 20
Less : Variable Cost Per Unit (B) 25 20 6
Contribution Margin per Unit ( C ) 15 14 14
Product Mix (D) 30% 20% 50% 100%
Weighted Average Price (A * D) 12 6.8 10 28.8
Weighted Average Cost (B * D) 7.5 4 3 14.5
Weighted Average Contribution Margin (C * D) 4.5 2.8 7 14.3
Break Even Point in Units (Fixed Cost / WA Contribution Margin) 321000/14.30
Break Even Point in Units ( Round off)     22,448.00

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