Question
Perform cost-volume-profit analysis and make a strategic decision. Product Details Selling Price ($) Variable Cost per Unit ($) Fixed Costs ($) Product X $150 $100
Perform cost-volume-profit analysis and make a strategic decision.
Product Details | Selling Price ($) | Variable Cost per Unit ($) | Fixed Costs ($) |
Product X | $150 | $100 | $500,000 |
Product Y | $200 | $140 | $700,000 |
Requirements:
Calculate the contribution margin per unit and contribution margin ratio for each product.
Determine the breakeven point in units and sales dollars for both products.
Conduct sensitivity analysis to evaluate the impact of different sales mix scenarios on profitability.
Recommend a pricing strategy considering the CVP analysis and competitive market dynamics.
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Accounting Information Systems
Authors: Marshall B. Romney, Paul J. Steinbart
12th edition
132552620, 978-0132552622
