erumpifier Multiproduct Breakeven Case

ABC Company has committed to contracts and other fixed expenses in the amount of $100,000 per

month. Its four major product lines include the following hair care products:

Structurizers

Volumizers

Derumpifiers

Coagulators (to stop the bleeding)

Anticipated annual volumes for each of the above respectively is: 10,000, 20,000, 30,000, 40,000 units.

Variable costs for each of the above respectively is: $10, $15, $20, $25

Selling price for each of the above respectively is: $20, $60, $50, $75

Required:

1.

Complete the Multiproduct breakeven analysis and:

A.

Find the annual multi product breakeven for ABC Company.

B.

Identify the product ABC makes the most money on per sales dollar?

C.

Identify which is the most important product line for ABC in terms of sales volume?

D.

Identify how much money the company makes on each sales dollar in terms of overall

contribution margin?

E.

Is contribution margin profit?

F.

Is the company breaking even? And if so, how much does it make?

G.

What can a company do when it is below breakeven?