part a Mullis Corp. manufactures DVDs that sell for $6.00. Fixed costs are $39,000 and variable costs are $4.70 per unit. Mullis can buy a newer production machine that will increase fixed costs by $12,000 per year, but will decrease variable costs by $0.40 per unit. What effect would the purchase of the new machine have on Mullis' break-even point in units?

partb

In Keegan Corporation's most recent fiscal year, the company reported pretax earnings of $233,000. Fixed costs totaled $486,000, the unit selling price of the firm's only product was $75, and the variable costs per unit were 40% of the selling price. Based on this information, the firm's break-even point in units was

part c

Madison Corporation sells three products (M, N, and O) in the following mix: 3:1:2. Unit price and cost data are:

	M			N			O
Unit sales price	$	11		$	8		$	9
Unit variable costs		6			5			8

Total fixed costs are $530,000. The selling price per composite unit for the current sales mix (rounded to the nearest cent) is:

partd

Barclay Enterprises manufactures and sells three distinct styles of bicycles: the Youth model sells for $420 and has a unit contribution margin of $165; the Adult model sells for $970 and has a unit contribution margin of $510; and the Recreational model sells for $1,120 and has a unit contribution margin of $560. The company's sales mix includes: 5 Youth models; 9 Adult models; and 6 Recreational models. If the firm's annual fixed costs total $6,620,000, calculate the firm's selling price per composite unit.

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