The company Sunshine Inc. produces two products for which the following data is included: ...
90.2K
Verified Solution
Link Copied!
Question
Accounting
The company Sunshine Inc. produces two products for which the following data is included:
Product X
Product Y
Sale Price per Unit
36
24
Variable cost per unit
28
12
Total fixed costs
234,000
Assume that products X and Y are normally produced in the ratio of 2 units of The tax rate is 30%.
Required:
Part A- if product X absorbs 60% of the total fixed costs (60% of $234,000), and product Y absorbs the remaining 40% 1. Calculate the break even point for the product 2. Determine the percentage contribution margin per product (% contribution margin) 3. Calculate the total margin of safety. 4. At what price would product Would this strategy be appropriate? Explain.
Part B- If X and Y are produced in the original proportions (sales mix, break even multiple products), calculate the number of units that would have to be produced of both products if a net income of $84,000 is to be generated.
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
