Question
De La Vega Company has three product lines of natural wigs: A, B, and C, with contribution margins of $28, $20, and $16, respectively. The
De La Vega Company has three product lines of natural wigs: A, B, and C, with contribution margins of $28, $20, and $16, respectively. The president foresees sales of 1,600,000 units in the coming period, consisting of 600,000 units of A, 800,000 units of B, and 200,000 units of C. The companys fixed costs for the period are $6,860,000.
Required:
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What is meant by sales mix? How is it determined?
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What is the companys breakeven point in units of each product line assuming that the given sales mix is maintained?
- If the sales mix is maintained, what is the total contribution margin when 1,404,000 units are sold? What is the operating income?
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The Corporate Culture Audit
Authors: Nigel Bristow, Sarah J. Sandberg
1st Edition
095597075X, 978-0955970757
