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Fixed Expense= 569,800 Requirement 10. Say the company adds a second size of SD card (512GB in addition to 256GB). A 512GB SD card will
Fixed Expense= 569,800
Requirement 10. Say the company adds a second size of SD card (512GB in addition to 256GB). A 512GB SD card will sell for $50 and have variable cost per unit of $28 per unit. The expected sales mix is four of the 256GB SD cards for every one of the 512GB SD cards. Given this sales mix, how many of each type of SD card will the company need to sell to reach its target monthly profit of $260,400? Is this volume higher or lower than previously needed (in Question 5) to achieve the same target profit? Why? Begin by computing the weighted-average contribution margin per unit. (Round all amounts to the nearest cent, $X.XX.) 256 GB 512 GB Total 25.00 $ 50.00 Sales price per unit $ 17.90 28.00 Variable cost per unit Less: Contribution margin per unit $ 7.10 $ 22.00 Sales mix 28.40 $ 22.00 $ $ Contribution margin 50.40 $ 10.08 Weighted average contribution margin per unit Sales price per unit 25.00 $ 50.00 28.00 17.90 Variable cost per unit Less Contribution margin per unit $ 7.10 $ 22.00 1 5 Sales mix $ 28.40 $ 22.00 $ 50.40 Contribution margin $ 10.08 Weighted average contribution margin per unit Given this sales mix, how many of each type of SD card willl the company need to sell to reach its target monthly profit of $260,400? (Round new target sales in units up to the next whole unit. Round units of the 256GB SD cards and 512GB SD cards to the nearest whole unit.) The new target sales in units is units of the 256GB SD cards The company will need to sell units of the 512GB SD cards. andStep by Step Solution
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