2. The garden supply company is introducing various aged trees to their product range in 2021. They have provided the following information relating to its planned activities.

	1year old	2years old	3years old
Selling Price	$15	$24	$40
Variable cost/unit	$10	$16	$25
Expected Sales Volume	25,000	15,000	10,000

Total fixed cost = $200,000 Required

a. Calculate the contribution margin, sales mix and weighted average contribution margin for each product.

b. Calculate the break-even point in total units and units per product based on the data.

c. Management is now considering increasing the price of 1 year old trees to $17 with an expected drop in volume to 15,000 trees while lowering the price of 3 year old trees to $35 with an expected increase in volume to 20,000 trees. There would be no change to the price and sales volume of 2 year old trees. Implementing this initiative would increase annual fixed costs by $10 000. On the available data, would you recommend the initiative?