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R&R Tax Service offers tax and consulting services to individuals and small businesses. Data for fees and costs for three types of tax returns follow.
R&R Tax Service offers tax and consulting services to individuals and small businesses. Data for fees and costs for three types of tax returns follow. Fixed costs total $49,880. Type of Return Easy Moderate Business Sales Mix 10% 10% 80% Fee Charged $ 40 100 240 Variable Cost per Return $ 20 60 140 (1) Determine the weighted average contribution margin. Sales mix Contribution margin per return Total per unit 10% $ 40.00 Easy Moderate 10% 100.00 Business 80% 240.00 Weighted average contribution margin (2) Determine the break-even point in units using the weighted average contribution margin. Numerator: Denominator: Break Even Units 1 Break even units 0 Units sales at the break-even point (3) Determine the number of units of each product that will be sold at the break-even point. Sales mix Number of units to break even Easy Moderate Business
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