Question

Sales Mix and Break-Even Sales

Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $195,000, and the sales mix is 70% bats and 30% gloves. The unit selling price and the unit variable cost for each product are as follows:

Products |
Unit Selling Price |
Unit Variable Cost |
||

Bats | $60 | $50 | ||

Gloves | 150 | 90 |

**a.** Compute the break-even sales (units) for the
overall enterprise product, E.

fill in the blank 1 units

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

Baseball bats | fill in the blank |

Baseball gloves | fill in the blank |

Answer #1

baseball bats | baseball gloves | Total | |||

i | Sales price | 60 | 150 | ||

ii | variable cost | 50 | 90 | ||

iii=i-ii | Contribution margin | 10 | 60 | ||

iv | mix | 70% | 30% | ||

v=iii*iv | Contribution margin mix | $ 7.00 | $ 18.00 | $ 25.00 | |

Ans 1 = | |||||

Fixed cost = | 195,000 | ||||

Breakeven mix = | 7,800 | ||||

195000/25 | |||||

ans = |
7,800 |
units | |||

Ans 2= | |||||

Baseball bats= | 7800*70% |
5,460 |
|||

baseball gloves= | 7800*30% |
2,340 |
|||

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