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Max Company manufactures and sells three products: Good, Better, and Best. Annual fixed costs are $2,145,000, and data about the three products follow. Good Better

Max Company manufactures and sells three products: Good, Better, and Best. Annual fixed costs are $2,145,000, and data about the three products follow.

Good Better Best
Sales mix in units 40 % 50 % 10 %
Selling price $ 220 $ 320 $ 470
Variable cost 90 140 240

Required:

  1. Determine the weighted-average unit contribution margin.
  2. Determine the break-even volume in units for each product.
  3. Determine the total number of units that must be sold to obtain a profit for the company of $280,500.

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