Exercise 18-22 CVP analysis using composite units LO P4 Handy Home sells windows and doors in the ratio of 8:2 (windows:doors). The selling price of each window is $110 and of each door is $260. The variable cost of a window is $67.50 and of a door is $180.00. Fixed costs are $750,000. (Enter your "per unit" values in two decimal places.) (1) Determine the selling price per composite unit. Quantity Selling Price per unit Total per composite unit Windows Doors (2) Determine the variable costs per composite unit. Variable costs per Quantity unit Windows Doors Total per composite unit Contribution margin per composite unit Contribution margin (3) Determine the break-even point in composite units. Choose Choose Numerator: Denominator: / Break Even Units Break even units (4) Determine the number of units of each product that will be sold at the break-even point. Number of composite Unit sales at break- Quantity units to break even. even point Windows Doors Exercise 18-24 Operating leverage computed and applied LO A2 Company A is a manufacturer with current sales of $3,600,000 and a 60% contribution margin. Its fixed costs equal $1,600,000. Company B is a consulting firm with current service revenues of $3,500,000 and a 25% contribution margin. Its fixed costs equal $340,000. Compute the degree of operating leverage (DOL) for each company. Contribution Margin Income Statement Company A Company B Choose: Degree of Operating Leverage Numerator I Denominator = Ratio Degree of Operating Leverage 1 Company A Company B Identify which company benefits more from a 20% increase in sales. Company A Company B