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Lindstrom Company produces two fountain pen models. Information about its products follows: Product A Product B Sales revenue $ 150,000 $ 200,000 Less: Variable costs

Lindstrom Company produces two fountain pen models. Information about its products follows:

Product A Product B
Sales revenue $ 150,000 $ 200,000
Less: Variable costs 57,000 62,000
Contribution margin $ 93,000 $ 138,000
Total units sold 5,000 5,000

Lindstroms fixed costs total $86,000.

Required:

1. Determine Lindstroms weighted-average unit contribution margin and weighted-average contribution margin ratio.

2. Calculate Lindstroms break-even point in units and in sales revenue.

3. Calculate the number of units that Lindstrom must sell to earn a $120,000 profit.

4. Calculate Lindstroms margin of safety and margin of safety as a percentage of sales if it sells 7,200 total pens.

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