Question

A company sells three different products: Product A, Product B, and Product C. The contribution margin per unit for each of the products is as follows: $30 for Product A, $50 for Product B, and $60 for Product C. The company’s sales mix in units is as follows: 50% Product A, 30% Product B, and 20% Product C. The company’s fixed costs amount to $1,680,000. How many units of each product must the company sell in order to break even?

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Answer #1

A company sells three different products: Product A, Product B,
and Product C. The contribution margin per unit for each of the
products is as follows: $30 for Product A, $50 for Product B, and
$60 for Product C. The company’s sales mix in units is as follows:
50% Product A, 30% Product B, and 20% Product C. The company’s
fixed costs amount to $1,680,000. How many units of each product
must the company sell in order to break even?

Yard Tools manufactures lawnmowers, weed-trimmers, and
chainsaws. Its sales mix and unit contribution margin are as
follows.
Sales Mix
Unit Contribution
Margin
Lawnmowers
20
%
$33
Weed-trimmers
50
%
$21
Chainsaws
30
%
$37
Yard Tools has fixed costs of $4,342,800.
Compute the number of units of each product that Yard Tools must
sell in order to break even under this product mix.
Lawnmowers
units
Weed-trimmers
units
Chainsaws
uni

PROBLEM 3 – Contribution Margin Income Statement
Brooks Company manufactures a product that sells for $50 per unit.
Brooks incurs a variable cost per unit of $35 and $2,400,000 in
total fixed costs to produce this product. It is currently selling
200,000 units.
Instructions: Complete each of the following requirements:
(b) Compute the contribution margin per unit and contribution
margin ratio.
(c) Compute the break-even point in units.
(d) Compute the break-even point in dollars.
(e) Compute the number of...

Tiago makes three models of camera lens. Its product mix and
contribution margin per unit follow:
Percentage of Unit sales
Contribution Margin per unit
Lens A
25
%
$
38
Lens B
40
30
Lens C
35
43
Suppose the product mix has shifted to 40/30/30.
Required:
1. Determine the new weighted-average
contribution margin per unit.
2. Determine the number of units of each
product that Tiago must sell to break even if fixed costs are
$187,000.
3. Determine how...

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...

Tiago makes three models of camera lens. Its product mix and
contribution margin per unit follow:
Percentage of Unit sales
Contribution Margin per unit
Lens A
23
%
$
41
Lens B
39
33
Lens C
38
46
Required:
1. Determine the weighted-average contribution
margin per unit.
2. Determine the number of units of each
product that Tiago must sell to break even if fixed costs are
$181,000.
3. Determine how many units of each product
must be sold to...

The Noble Company manufactures two products. Information about
the two products is as follows:
Product A
Product B
Selling price per unit
$80
$30
Variable costs per unit
45
15
Contribution margin per unit
$35
$15
The company expects the fixed costs to be $189,000. The firm
expects 60% of its sales (in units) to be of Product A (a sales mix
of 3:2).
Required:
A. Calculate the contribution margin per
package.
$
B. Determine the break-even point in units...

Tiago makes three models of camera lens. Its product mix and
contribution margin per unit follow: Percentage of Unit sales
Contribution Margin per unit Lens A 23 % $ 38 Lens B 36 30 Lens C
41 43 Required:
1. Determine the weighted-average contribution margin per unit.
(Round your intermediate calculations and final answer to 2 decimal
places.)
2. Determine the number of units of each product that Tiago must
sell to break even if fixed costs are $181,000. (Round...

Sales Mix and Break-Even Sales
Dragon Sports Inc. manufactures and sells two products, baseball
bats and baseball gloves. The fixed costs are $652,500, and the
sales mix is 30% bats and 70% 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.
units
b. How many units of each...

oFly Corporation sells three different models of a mosquito
“zapper.” Model A12 sells for $50 and has variable costs of $35.
Model B22 sells for $100 and has variable costs of $70. Model C124
sells for $400 and has variable costs of $300. The sales mix of the
three models is A12, 60%; B22, 15%; and C124, 25%. If the company
has fixed costs of $269,500, how many units of each model must the
company sell in order to break...

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