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Maxie Pty Ltd makes and sells two types of shoes, Plain and Fancy. Product data is as follows: Plain Fancy Unit selling price $20.00 $35.00
Maxie Pty Ltd makes and sells two types of shoes, Plain and Fancy. Product data is as follows:
Plain Fancy
Unit selling price $20.00 $35.00
Variable costs per unit $12.00 $24.50
Sixty per cent of the sales in units are Plain and annual fixed expenses are $45 000 and the sales mix remains constant. Assume an income tax rate of 20 per cent.
The break-even point for this data is 5 000 units in total. How will the calculation of the break-even point change (if at all) if the relative percentages of the products in the mix change from 60% to 40%?
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