Exercise 3-47 (Algo) Multiproduct CVP Analysis (LO 3-4)

Mission Foods produces two flavors of tacoschicken and fishwith the following characteristics.

	Chicken			Fish
Selling price per taco	$	3.10		$	5.10
Variable cost per taco		1.55			2.55
Expected sales (tacos)		204,000			299,000

The total fixed costs for the company are $116,000.

Required:

a. What is the anticipated level of profits for the expected sales volumes?

b. Assuming that the product mix would be 40 percent chicken and 60 percent fish at the break-even point, compute the break-even volume using weighted-average contribution margin.

c. If the product sales mix were to change to four chicken tacos for each fish taco, what would be the new break-even volume?