Question
Paga Ya Paga Limited manufactures and sells Motor King to customers divided into High Quality, Medium Quality and Low-Quality motor Kings and categories below: Sales
Paga Ya Paga Limited manufactures and sells Motor King to customers divided into High Quality, Medium Quality and Low-Quality motor Kings and categories below: Sales Price Involved Cost Commission on Sales Gh Gh Gh High quality 3,400 1,200 80 Medium quality 2,300 1,080 60 Low quality 1,700 690 40 It is on record that sale quantities of Low-Quality Motor King is twice compared to Medium and High-Quality Motor Kings. Annual fixed cost of GH310,000 is expected to be incurred. You are required to: i. Compute the sales mix. ii. Compute the unit contribution margin for each brand of Motor King. iii. Compute the weighted average unit contribution. iv. Compute break-even sales in volume and in sales. v. How many motor kings should be sold to earn a target profit of GH15,000?
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