Sales Mix and Break-Even Sales The estimated fixed costs for the current year ar

ID: 2421248 • Letter: S

Question

Sales Mix and Break-Even Sales

The estimated fixed costs for the current year are $2,498,600.

Required:

1. Determine the estimated units of sales of the overall (total) product, E, necessary to reach the break-even point for the current year.
units

2. Based on the break-even sales in units in part (1), determine the unit sales of both laptops and tablet PCs for the current year.

3. Assume that the sales mix was 50% laptops and 50% tablet PCs. Compute the break-even point of the overall (total) product E.
units

Laptops units Tablet PCs units

1. Sales =$1600 x 40% + 850 x 60% =1150

Variable cost = $800 x40% + 350 x 60% = 530

Contribution = $620

BEP(in units) = Fixed cost / Cotribution per unit

= 2498600/620

= 4030 units

2. Laptop sales = 4030 x 40%

= 1612 units

Tablet's sales = 4030 x 60%

=2418

3. Sales =$1600 x 50% + 850 x 50% =1225

Variable cost = $800 x50% + 350 x 50% = 575

Contribution = $650

BEP(in units) = Fixed cost / Cotribution per unit

= 2498600/650

= 3844 units

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