Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Morris Industries manufactures and sells three products (AA, BB, and CC). The sales price and unit variable cost for the three products are as follows:

image text in transcribedimage text in transcribed

Morris Industries manufactures and sells three products (AA, BB, and CC). The sales price and unit variable cost for the three products are as follows: Sales Price Variable Cost Product per Unit per Unit AA $50 $25 BB 45 15 CC 25 10 Their sales mix is reflected as a ratio of 5:3:2. Annual fixed costs shared by the three products are $357,500 per year. A. What are total variable costs for Morris with their current product mix? Total variable costs $1 B. Calculate the number of units of each product that will need to be sold in order for Morris to break even. Number of Units per Product BB CC C. What is their break-even point in sales dollars? Break-even point in sales s D. Using an income statement format, prove that this is the break-even point. If an amount is zero, enter "0". Income Statement Sales Product AA Product BB Product CC Total Sales Variable Costs Product AA Product BB Product CC Total Variable Costs Contribution Margin $ Fixed Costs Net Income

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

Intermediate Accounting Volume 2

Authors: Kin Lo, George Fisher

4th Edition

0135220491, 9780135220498

More Books

Students also viewed these Accounting questions