Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Instructions Suppose that Head-First Company now sells both bicycle helmets and motorcycle helmets. The bicycle helmets are priced at $75 and have variable costs of
Instructions Suppose that Head-First Company now sells both bicycle helmets and motorcycle helmets. The bicycle helmets are priced at $75 and have variable costs of $44 each. The motorcycle helmets are priond at $235 and have variable costs of $130 each. Total fixed cost for Head-First as a whole equals $65,700 (includes all fixed factory overhead and fixed selling and administrative expense), Next year, Head-First expects to sell 4,900 bicycle helmets and 1,960 motorcycle helmets. Beauired: 1. Form a package of bicycle and motorcycle helmets based on the sales mix expected for the coming year. 2. Calculate the break-even point in units for bicycle helmets and for motorcycle helmets. 3. Check your answer by preparing a contribution margin toome statement Refer to the list below for the exact wording of textoms within your income statement Amount Description Operating Income Operating loss Ses Total contribution margin Total food com Total variable cost nstructions Sales Mix and Break-Even Point 1. Form a package of bicycle and motorcycle helmets based on the sales mix expected for the coming year, Package Contribution Margin Sales Mix Unit Contribution Margin Price Product Unit Variable Cost 15 IS Bicycle helmet Motorcycle helmet Package total 5 2 Calculate the break-even point in units for bicycle helmets and for motorcycle helmets. Break-Even Bicycle Helmets Break-Even Motorcycle Helmets 3. Check your answer by preparing a contribution margin income statement. Refer to the list of Amount Descriptions for the exact wording of text items within your income statement Hond First Company Contribution Margin Income Statement Al Break-Even Point
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started