Question
ission Foods produces two flavors of tacos, chicken and fish, with the following characteristics: Chicken Fish Selling price per taco $ 3.40 $ 5.00 Variable
ission Foods produces two flavors of tacos, chicken and fish, with the following characteristics:
Chicken | Fish | |||||
Selling price per taco | $ | 3.40 | $ | 5.00 | ||
Variable cost per taco | 1.70 | 2.50 | ||||
Expected sales (tacos) | 200,000 | 298,000 | ||||
The total fixed costs for the company are $119,000.
Required:
a. What is the anticipated level of profits for the expected sales volumes?
b. Assuming that the product mix would be 45 percent chicken and 55 percent fish at the break-even point, compute the break-even volume. (In your computations, round up the total units to break-even to the nearest whole number and round other intermediate calculations to 2 decimal places. Round your final answers up to the nearest whole unit.)
Chicken break even volume:
Fish break even volume:
c. If the product sales mix were to change to four chicken tacos for each fish taco, what would be the new break-even volume? (In your computations, round up the total units to break-even to the nearest whole number and round other intermediate calculations to 2 decimal places. Round your final answers up to the nearest whole unit.)
Chicken break even volume:
Fish break even volume:
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored 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