Activity # 1

Genevieve Co. and Odessa Co. sell the same product in a competitive industry. Thus, selling price of the product for each company is the same. Other data about the two companies are as follows:

Genevieve Co. Odessa Co.

Fixed Costs P50,000 P70,000

Contribution Margin Ratio 40% 52%

Required:

1.The company's break-even points in units are?

2.The company's break-even points in peso are?

3.The Variable cost at break-even points are?

Activity # 2

A company sells two products, product 1 and product 2. Three units of product 1 is sold for every two units of product 2. Fixed costs is P234,000 per year.

Product 1 is sold for P20 per unit and the variable costs is identified with the production and sale of each unit of the product amounts to P14. Product 2 is sold for P24 per unit, and the variable costs identifies with the production and the sale of each unit of the product amounts to P20.

Required:

1.The weighted-average unit contribution margin is

2.The break-even point in units

3.The weighted-average contribution margin ratio is

Activity # 3

Following information pertains to X company's two products:

Digicam Videocam

Break-even point in units 360 240

Selling price P4,500 P14,250

Variable Costs 2,250 5,000

Required:

1.What is the weighted-average contribution margin?

2.How much is the total fixed costs?

3.How many units of each product should be sold if the company desires to earn a profit before tax of P1,515,000?