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Beach Inc. makes three models of high-performance weight-training benches. Current operating data are summarized here: ( mutli step question --- a to f) Muscle Muscle
Beach Inc. makes three models of high-performance weight-training benches. Current operating data are summarized here:
( mutli step question --- a to f)
Muscle
Muscle Beach Inc. makes three models of high-performance weight-training benches. Current operating data are summarized here: MegaMuscle 138 S PowerGym ProForce Selling price per unit Contribution margin per unit Monthly sales volume-units Fixed expenses per month S 284 197 41 76 58 2,000 Total of $320,400 3.000 1,060 a. Calculate the contribution margin ratio of each product. b. Calculate the firm's overall contribution margin ratio. c. Calculate the firm's monthly breakeven point in sales dollars. d. Calculate the firm's monthly operating income. e. Management is considering the elimination of the ProForce model due to its low sales volume and low contribution margin ratio. As a result, total fixed expenses can be reduced to $265,600 per month. Assuming that this change would not affect the other models, what would be the effect on net operating income. Would you recommend the elimination of the Pro Force model? f. Assume the same facts as in requirement e-1. Assume also that the sales volume for the PowerGym model will increase by 506 units per month if the ProForce model is eliminated. What would be the effect on operating income. Would you recommend eliminating the ProForce modelStep by Step Solution
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