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1.For your first assignment, management has provided the following revenue and cost information: High-End SetEconomical SetSales price$3,500per unit$1,000per unitLabor$875per unit$250per unitMaterials$1400per unit$300per unit Direct fixed
1.For your first assignment, management has provided the following revenue and cost information:
High-End SetEconomical SetSales price$3,500per unit$1,000per unitLabor$875per unit$250per unitMaterials$1400per unit$300per unit
Direct fixed costs$25,000per month$16,500per monthAllocated fixed costs$85,000per month$85,000per month
They want a better understanding of their business to make budgeting and sales goals decisions and have asked you to determine their:
- Contribution Margins for each product line
- Break-even quantities for each product line
- Break-even quantities to earn $500,000 per year margin on the high-end line (at the current sales price)
- Break-even quantities to earn $300,000 per year margin on the economical line (at the current sales price)
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