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Scooters Ltd sells three types of scooters. It has fixed costs of $258,000 per month. The sales and variable costs of these products for April

Scooters Ltd sells three types of scooters. It has fixed costs of $258,000 per month. The sales and variable costs of these products for April are shown below:

S1

S2

S3

Sales

$1 000 000

$1 500 000

$2 500 000

Variable costs

$ 700 000

$ 900 000

$1 250 000

Determine the sales mix of the three products.

Calculate the break-even point in sales dollars for the company.

Calculate the break-even point in sales dollars for each scooter.

Calculate the margin of safety at the present sales level in dollars.

Discuss the weaknesses of the CVP analysis technique as a financial planning tool.

Can flexible budgets be used to overcome its weaknesses? Explain.

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