Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Express Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from the delivery of mailing pouchesand small, standardized delivery boxes

image text in transcribed
image text in transcribed
Express Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from the delivery of mailing "pouches"and small, standardized delivery boxes (which provides a 20% contribution margin). The other 20% of its revenue came from delivering non-standardized boxes (which provides a 70% contribution margin). With the rapid growth of Internet retail sales, Express believes that there are great opportunities for growth in the delivery of non-standardized boxes. The company has fixed costs of $13,824.900. (a) What is the company's break-even point in total sales dollars? At the break-even point, how much of the company's sales are provided by each type of service? (Use Weighted-Average Contribution Margin Ratio rounded to 2 decimol ploces es. 0.22 and round final answers to 0 decimal ploces, es. 2,510.) Total break-even sales Sale of mail pouches and small boxes $ Sale of non-standard booces (b) The company's management would like to hold its fixed costs constant but shift its sales mix so that 608 of its revenue comes from the delivery of non-standardized boxes and the remainder from pouches and small boxes. If this were to occur, what would be the company's break-even sales, and what amount of sales would be provided by each service type? (Use Welghted-Average Contribution Margin Ratio rounded to 2 decimal places es. 0.22 and round final answers to 0 decimol places, eg. 2,510.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Cases In Hong Kong The First Hksa Case Competition

Authors: HKSA Case, Monograph Work GP

1st Edition

9629370883, 978-9629370886

More Books

Students also viewed these Accounting questions