Problem 3-25A Determining the break-even point and margin of safety for a compan

Question

Problem 3-25A Determining the break-even point and margin of safety for a company with multiple products LO 3-6 Watt Company produces two products. Budgeted annual income statements for the two products are provided here: Power Lite Budgeted PerBudgeted Budgeted Per Budgeted Budgeted Budgeted Number UnitAmount Number UnitAmount Number Amount 320 $640 $204,800480 $590-$283,200 800 $488,000 Variable cost 320400 (128,000) 480350 168,000) 800 (296,000) Sales Contribution3202 Fixed cost Net income 320@ 240= 76.800 480 @ 240; 115.200 800 192,000 (108,000) $84,000 margin (15,000) (93,000) $ 61,800 $22,200 Required: a. Based on budgeted sales, determine the relative sales mix between the two products Relative percentage for Power Relative percentage for Lite 3% Prev 6016 Next >

Explanation / Answer

a

b

c

d

e

f

a Releative Percentage of Power =320/800 40.0% b Releative Percentage for Lite =480/800 60.0%

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