6L-1
Pin Cushion Company produces two models of sewing basket. Information about Pin Cushion's products is given below: Sales revenue Less: Variable costs Contribution margin Total units sold Product A $ 42,000 17,000 $ 25,000 1,060 Product B $57,000 25,400 $31,600 2,100 Pin Cushion's fixed costs total $39,400. Required: 1. Determine Pin Cushion's weighted-average unit contribution margin and weighted-average contribution margin ratio. 2. Calculate Pin Cushion's break-even units and break-even sales revenue. 3. Calculate the number of units of each product that must be sold to break even. 4. Calculate the total sales necessary for Pin Cushion to earn a profit of $66,000. 5. Calculate the sales revenue generated from each product line if Pin Cushion earns its target profit of $66,000. 6. Using the original information, calculate Pin Cushion's degree of operating leverage. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Determine Pin Cushion's weighted average unit contribution margin and weighted average contribution margin ratio. (Round your intermediate calculations to 2 decimal places. Round your CM per unit and weighted average CM ratio to two decimal places (i.e. .1234 should be entered as 12.34%.) Weighted-Average Unit CM Weighted Average CM Ratio % Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Calculate Pin Cushion's break-even units and break-even sales revenue. (Round your units to the nearest whole number and sales revenue to two decimal places.) Units Break-Even Sales Units Break Even Sales Revenue Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Calculate the number of units of each product that must be sold to break even. (Round your answers to the nearest whole number.) No. of Units Product A Units Units Product B Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Calculate the total sales necessary for Pin Cushion to earn a profit of $66,000. (Round your intermediate calculations to 2 decimal places. Round your answer to 2 decimal places.) Target Sales Revenue Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Calculate the sales revenue generated from each product line if Pin Cushion earns its target profit of $66,000. (Round your intermediate calculations to 2 decimal places. Round your answers to 2 decimal places.) Product A Product B Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Using the original information, calculate Pin Cushion's degree of operating leverage. (Round your answer to 2 decimal places.) Degree of Operating Leverage
