Question 1:

Lumpy Soup Limited presently produces road signs and computers for the Brazil and South African markets but is looking to expand to cover a greater international range.

The key planned financial information related to the companys key products for 2024 are as follows:

Activity	Road Signs	Computers
Selling Price	$180.00	$150.00
Direct Material (per unit)	$21.00	$11.00
Direct Labour (per unit)	$19.00	$75.00
Variable Manufacturing Overhead (per unit)	$11.00	$21.00
Variable Selling Expense (per unit)	$26.00	$9.00
Fixed Manufacturing Overhead (total)	$2,140,000	$400,000
Fixed Administrative Overhead (total)	$560,000	$600,000
Fixed Marketing Overhead(total)	$900,000	$1,850,000

The company has a sales mix ratio of 30% to 70%. The company has estimated that in 2024 they will produce and sell 140,000 total units.

Required:

1) Calculate the contribution margin per unit and the contribution ratio for Lumpy Soup Limited based on production and sales estimates for 2024 and based on the sales mix of 30% to 70%.

2) Calculate the total number of units that are required to be sold in 2024 in order for Lumpy Soup Limited to breakeven given the 30% to 70% mix ratio.

3) Calculate the total sales revenue Lumpy Soup Limited would achieve at the breakeven quantity given the 30% to 70% sales mix ratio and projected production and sales estimates for 2024.

4) Assume in 2024 the minimum net income Lumpy Soup Limited wishes to achieve is $9,000,000. Given the sales mix ratio of 30% to 70%, what is the revenue Lumpy Soup Limited would generate to ensure achieve the desired minimum net income and the number of road signs and computers to be sold?