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Handy Home sells windows (60% of sales) and doors (40% of sales). The selling price of each window is $400 and of each door is
Handy Home sells windows (60% of sales) and doors (40% of sales). The selling price of each window is $400 and of each door is $900. The variable cost of each window is $225 and of each door is $550. Fixed costs are $1,457,750. (1) Compute the weighted-average contribution margin. Sales mix Contribution margin Windows Doors Weighted-average contribution margin (2) Compute the break even point in units using the weighted average contribution margin. Numerator: 1 1 Denominator: (3) Compute the number of units of each product that will be sold at the break-even point. Sales mix Number of units to break even Windows Doors Total Total per unit Break Even Units = Break Even Units Unit sales at break-even point
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