Figg Inc. has fixed costs of $420,000. The unit selling price, variable cost per

Question

Figg Inc. has fixed costs of $420,000. The unit selling price, variable cost per unit, and contribution margin per unit for the company's two products are provided below. The sales mix for products L and M is 60% and 40%, respectively. Determine the break-even point in units of L and M. Product L: units Product M:

Explanation / Answer

Let total number of units = x =>Units of L = 0.6*x and Unis of M = 0.4*x Cost = 420000+(0.6*20*x)+(0.4*18*x) = Revenue = 0.6*80*x+0.4*62*x =>420000 = (0.6*60)+(0.4*44) * x =>x = 7835.821 units of L = 4701.493 units of M = 3134.328

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