Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ivanhoe Repairs has 200 auto-maintenance service outlets nationwide. It performs primarily two lines of service: oil changes and brake repair. Oil change-related services represent

image text in transcribedimage text in transcribedimage text in transcribed

Ivanhoe Repairs has 200 auto-maintenance service outlets nationwide. It performs primarily two lines of service: oil changes and brake repair. Oil change-related services represent 70% of its sales and provide a contribution margin ratio of 20%. Brake repair represents 30% of its sales and provides a 40% contribution margin ratio. The company's fixed costs are $13,728,000 (that is, $68,640 per service outlet). Sales mix is determined based upon total sales dollars. (a) Calculate the dollar amount of each type of service that the company must provide in order to break even. (Use Weighted-Average Contribution Margin Ratio rounded to 2 decimal places eg. 0.25 and round final answers to O decimal places, e.g. 2,510.) Sales Dollars Needed Per Product Oil changes $ Brake repair

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Human Resource Management

Authors: John Bernardin

6th Edition

978-0078029165, 0078029163

More Books

Students also viewed these Accounting questions

Question

8. Prove Theorem 1. 43iii , iv, and v.

Answered: 1 week ago