Sales Mix and Break-Even Sales Dragon Sports Inc. manufactures and sells two pro

Question

Sales Mix and Break-Even Sales

Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costsare $1,013,200, and the sales mix is 20% bats and 80% gloves. The unit selling price and the unit variable cost for each product are as follows:

a. Compute the break-even sales (units) for the overall enterprise product, E.
units

b. How many units of each product, baseball bats and baseball gloves, would be sold at the break-even point?

Explanation / Answer

Contribution margin=Sales-Variable cost

Contribution margin for Bats=(80-60)=$20

Contribution margin for Gloves=(200-120)=$80

Weighted Contribution margin=(20*0.2)+(80*0.8)=68

1.Breakeven=Fixed cost/Contribution margin

=(1013200/68)=14900 units

2.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.