Good Scent, Inc., produces two colognes: Rose and Violet. Of the two, Rose is more popular. Data concerning the two products follow:

Rose Violet

Expected sales (in cases) 59,500 11,900

Selling price per case $100 $82

Direct labor hours 32,450 6,450

Machine hours 9,550 3,400

Receiving orders 49 25

Packing orders 96 48

Material cost per case $53 $44

Direct labor cost per case $9 $8

The company uses a conventional costing system and assigns overhead costs to products using direct labor hours. Annual overhead costs follow. They are classified as fixed or variable with respect to direct labor hours.

Fixed Variable

Direct labor benefits $ $190,610

Machine costs 201,500* 276,190

Receiving department 206,000

Packing department 133,500

Total costs $541000 $466,800

* All depreciation Required: 1. Using the conventional approach, compute the number of cases of Rose and the number of cases of Violet that must be sold for the company to break even. In your computations, round variable unit cost to the nearest cent and round the number of break-even packages to the nearest whole number.

Break-even cases of Rose ?

Break-even cases of Violet ?

2. Using an activity-based approach, compute the number of cases of each product that must be sold for the company to break even. In your computations, round all computed amounts to the nearest cent and round the number of break-even packages to the nearest whole number.

Break-even cases of Rose

?

Break-even cases of Violet ?