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Alpine Ski Company recently expanded its manufacturing capacity. During 2021, the firm produced and sold 5.000 units of skiing equipment including boots, goggles, and
Alpine Ski Company recently expanded its manufacturing capacity. During 2021, the firm produced and sold 5.000 units of skiing equipment including boots, goggles, and helmets. Helmets represents half of their sales and the other half of sales is equally divided into goggles and boots. The company's annual fixed costs totaled 80.000s. Alpine Ski Company is subject to a 30% income tax rate. Product type Sale price per unit Helmet Goggles Variable Manufacturing costs per unit 60S 30S 80s 40S 155 Boots 558 Required: 1. Compute the unit contribution margin for each product type. (10 points) 2. What is the company's sales mix? (10 points) 3. Compute the weighted-average unit contribution margin and calculate the breakeven point in units for each product type. (20 points) 4. Prepare a contribution income statement of the company for 2021 knowing that: Variable selling costs equaled 5000S and variable administrative costs equaled 3500S. The total annual fixed costs were divided into 50.000S of fixed manufacturing costs, 10.000S of fixed selling costs and 20.000S of fixed administrative costs. Don't forget about the income taxes. (30 points). 5. How many products of each type should Alpine ski sell to eam a targeted net profit of 100.000S. (20 points) 6. Suppose the sales revenues increased by 5%, what would be the impact on net income? (10 points).
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