1. PR.21.05.ALGO (Algorithmic) Sales Mix and Break-Even Sales Data related to the expected sales of laptops and tablets for Tech Products Inc. for the current year, which is typical of recent years, are as follows: Products Unit Selling Price Unit Variable Cost Sales Mix Laptops $270 $180 20% Tablets 530 250 80% The estimated fixed costs for the current year are $1,239,040. 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 (units) in part (1), determine the unit sales of both laptops and tablets for the current year. Laptops: _ units Tablets: . units 3. Assume that the sales mix was 80% laptops and 20% tablets. Determine the estimated units of sales of the overall product necessary to reach the break-even point for the current year. units Why is it so different? The break-even point is ' in this scenario than in part (1) because the sales mix is weighted ' heavily toward the product with the V contribution margin per unit of product. 2. PR.21.02.ALGO (Algorithmic) Break-Even Sales Under Present and Proposed Conditions Darby Company, operating at full capacity, sold 146,700 units at a price of $81 per unit during the current year. Its income statement is as follows: Sales $11,882,700 Cost of goods sold 4,212,000 Gross profit $7,670,700 Expenses: Selling expenses $2,106,000 Administrative expenses 1,269,000 Total expenses 3,375,000 Income from operations $4,295,700 The division of costs between variable and fixed is as follows: Variable Fixed Cost of goods sold 60% 40% Selling expenses 50% 50% Administrative expenses 30% 70% Management is considering a plant expansion program for the following year that will permit an increase of $972,000 in yearly sales. The expansion will increase fixed costs by $129,600, but will not affect the relationship between sales and variable costs. Required: 1. Determine the total variable costs and the total fixed costs for the current year. Total variable costs $ Total fixed costs $ 2. Determine (a) the unit variable cost and (b) the unit contribution margin for the current year. Unit variable cost $ Unit contribution margin $ 3. Compute the break-even sales (units) for the current year. units 4. Compute the break-even sales (units) under the proposed program for the following year. units 5. Determine the amount of sales (units) that would be necessary under the proposed program to realize the $4,295,700 of income from operations that was earned in the current year. units 6. Determine the maximum income from operations possible with the expanded plant. $ 7. If the proposal is accepted and sales remain at the current level, what will the income or loss from operations be for the following year? $ 8. Based on the data given, would you recommend accepting the proposal? . In favor of the proposal because of the reduction in break-even point. . In favor of the proposal because of the possibility of increasing income from operations. . In favor of the proposal because of the increase in break-even point. . Reject the proposal because if future sales remain at the current level, the income from operations will increase. (DQnO'm . Reject the proposal because the sales necessary to maintain the current income from operations would be below the current year sales. Choose the correct answer. 7