Danny Cobb admired his wife's success at selling scarves at local crafts shows, so he decided to make two types of plant stands to sell at the shows. Danny makes twig stands out of downed wood from his backyard and the yards of his neighbors, so his variable cost is minimal (wood screws, glue, and so forth). However, Danny has to purchase wood to make his oak plant stands. His unit prices and costs are as follows: (Click the icon to view the data.) The twig stands are more popular, so Danny sells four twig stands for every one oak stand. Athena charges her husband $400 to share her booth at the craft shows (after all, she has paid the entrance fees). How many of each plant stand does Danny need to sell to breakeven? Will this affect the number scarves Athena needs to sell to breakeven? Explain. Determine how many of each plant stand Danny needs to sell to breakeven. Begin by computing the weighted average contribution margin per unit. First identify the formula labels, then complete the calculations step by step. Oak Total $ Twig 16.00 $ 3.00 43.00 Sale price per unit Less: Variable cost per unit Contribution margin per unit 15.00 13.00 28.00 Sales mix 5 Contribution margin 52.00 $ 28.00 $ 80.00 Weighted average contribution margin per unit 16.00 Next determine the formula to compute the breakeven sales in units. (Abbreviations used: Avg. = average and CM = contribution margin.) Operating income Fixed expenses ) + Weighed-avg. CM per unit = Breakeven sales in units Determine how many of each plant stands Danny needs to sell to breakeven. Data Table Breakeven sales of twig stands is units. Breakeven sales of oak stands is units. Sales price Twig Stands Oak Stands 16.00 $ 43.00 . $ 3.00 $ 15.00 Variable cost ... Print Done