Question

Tiger Golf Accessories sells golf shoes, gloves, and a laser-guided range-finder that measures distance. Shown below are unit cost and sales data.

		Pairs of Shoes			Pairs of Gloves			Range- Finder
Unit sales price		$105			$32			$245
Unit variable costs		59			10			205
Unit contribution margin		$46			$22			$40
Sales mix		31	%		41	%		28	%

Fixed costs are $658,568.
Calculate weighted-average unit contribution margin. (Round answer to 2 decimal places e.g. 10.25.)

Weighted-average unit contribution margin

$

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Compute the break-even point in units for the company.

Break-even point

units

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Determine the number of units to be sold at the break-even point for each product line.

Shoes
Gloves
Range Finders

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Answer 1

Answer- Weighted average contribution margin per unit = $34.48 per unit.

Explanation- Weighted average contribution margin per unit =Contribution margin per unit* Sales mix percentage

= ($46 per unit*31%)+($22 per unit*41%)+($40 per unit*28%)

= $14.26 per unit + $9.02 per unit + $11.2 per unit

= $34.48 per unit

Answer- The break-even point in units for the company = 19100 units.

Explanation- Units sold to breakeven = Fixed costs/ Weighted average contribution margin per unit

= $658568/$34.48 per unit

= 19100 units

Answer- Number of units to be sold at the break-even point for each product line =Break-even point in units*Sales mix

Shoes   = 19100 units *31% = 5921 units

Gloves = 19100 units *41% = 7831 units

Range-Finder = 19100 units * 28% = 5348 units