Question
Personal Electronix sells computer tablets and MP3 players. The business is divided into two divisions along product lines. CVP income statements for a recent quarters
Personal Electronix sells computer tablets and MP3 players. The business is divided into two divisions along product lines. CVP income statements for a recent quarters activity are presented below.
Tablet Division | MP3 Player Division | Total | ||||
---|---|---|---|---|---|---|
Sales | $884,500 | $565,500 | $1,450,000 | |||
Variable costs | 645,685 | 322,335 | 968,020 | |||
Contribution margin | $238,815 | $243,165 | 481,980 | |||
Fixed costs | 136,284 | |||||
Net income | $345,696 |
A. Determine sales mix percentage and contribution margin ratio for each division.
Sales Mix Percentage | ||
---|---|---|
Tablet division | 61% | |
MP3 Player division | 39% |
Contribution Margin Ratio | ||
---|---|---|
Tablet division | 27% | |
MP3 Player division | 43% |
B. Calculate the companys weighted-average contribution margin ratio. (Round computations and final answer to 2 decimal places, e.g. 15.26%.)
Weighted-average contribution margin ratio | 33.24% |
C. Calculate the companys break-even point in dollars. (Round computations to 2 decimal places and final answer to 0 decimal places, e.g. 1,526.)
Break-even point | $ 410000 |
D. Determine the sales level in dollars for each division at the break-even point. (Round computations to 2 decimal places and final answers to 0 decimal places, e.g. 1,526.)
Break-even point | ||
---|---|---|
Tablet division | $ | |
MP3 Player division | $ |
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