70.2K

Verified Solution

Link Copied!

Product Information - Unit Sales Price Units Manufactured and solde Sales Mix (% of total units sold) A $335.00 58204 52% BE $470.004 384142 48% Vary with Unit Costs Direct Materiale Direct Labore Other Vary-with-Unit Costs Total Vary with Unit Costs A $162.614 $44.80 $15.434 $377.364 B $264.534 $58.8042 $19.5142 $342.8442 Fixed Costs $183,868.2040 Vary-with-Revenue Costs Sales Commissions 3.5% 14 a) calculate the contribution margin per unit for each product (ensure you include vary with unit and vary with revenue costs) b) calculate the weighted Average Contribution Margin using the sales mix percentages calculated previously. c) calculate the break-even units (the combined number of units from the two products that need to be sold to not make a loss). As we cannot sell part of a product, apply an appropriate rounding function to get the answer to 0 decimal places. d) use the previous result and the sales mix to work out the break-even point in units per product e) calculate the break even point in dollars for each products f) calculate the Break-Even Variable Costs for the two products. g) calculate the Break-Even Contribution Margin (this is the contribution margin for the total number of units required to break even.) h) calculate the Break-Even Profit Before Tax. (Break even profit would normally be 0, but because we rounded up our break-even units, this should be slightly more than 0.)

Answer & Explanation Solved by verified expert

See Answer