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Patriot Company manufactures flags in two sizes, small and large. The company has total fixed costs of $270,000 per year. Additional data follow. Sales
Patriot Company manufactures flags in two sizes, small and large. The company has total fixed costs of $270,000 per year. Additional data follow. Sales price per unit Small $ 26 Large $ 38 Variable costs per unit $ 18 $ 20 Sales mix percent 80% 201 The company is considering buying new equipment that would increase total fixed costs by $47,900 per year and reduce the variable costs of each type of flag by $1 per unit. Required: 1. Compute the weighted-average contribution margin without the new equipment. 2. Assume the new equipment is not purchased. Determine the break-even point in total sales units and the break-even point in units for each product. 3. Assume the new equipment is purchased. Compute the break-even point in total sales units and the number of units to sell for each product. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3. Compute the weighted-average contribution margin without the new equipment. Weighted-average contribution margin
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