Question
Smith Company can produce two types of carpet cleaners, Brighter and Cleaner. Data on these two products are as follows: Brighter Cleaner Sales volume in
Smith Company can produce two types of carpet cleaners, Brighter and Cleaner. Data on these two products are as follows: Brighter Cleaner Sales volume in units 400 600 Unit sales price $ 1,000 $ 1,000 Unit variable cost 200 700 The number of machine hours to produce one unit of Brighter is 1, while the number of machine hours for each unit of Cleaner is 2. Total fixed costs for the manufacture of both products are $295,000.
Required: 1. Determine the breakeven point in total units for Smith Company, based on the assumption that the sales mix (on the basis of relative sales volume in units) remains constant. Use the weighted-average contribution margin approach.
2. At this breakeven level, how many units of each product must be sold? Due to rounding, the total breakeven units for Requirement 2 may differ slightly than in Requirement 1.
3. Using the Indirect approach, what is the overall breakeven point in sales dollars? Use the breakeven units computed in Requirement 1.
Smith Company can produce two types of carpet cleaners, Brighter and Cleaner. Data on these two products are as follows: Brighter Cleaner Sales volume in units 400 600 Unit. sales price $ 1, [II [10 5 1 .000 Unit. variable (:0 st 2 Cl 0 'i' 00 The number of machine hours to produce one unit of Brighter is 1, while the number of machine hours for each unit of Cleaner is 2. Total fixed costs for the manufacture of both products are $295,000. Required: 1. Determine the breakeven point in total units for Smith Company, based on the assumption that the sales mi): (on the basis of relative sales volume in units) remains constant. Use the weighted-average contribution margin approach. 2. At this breakeven level, how many units of each product must be sold? Due to rounding, the total breakeven units for Requirement 2 may differ slightly than in Requirement 1. 3. Using the Indirect approach, what is the overall breakeven point in sales dollars? Use the breakeven units computed in Requirement 1. Complete this question or enterlng your amoral In the tolls below. I Required]. Requide H Required3 Determine the breakeven point in total units for Smith Company, based on the assumption that the sales mix [on the basis of relative sales volume in units) remains oonstant. Use the weighted-average contribution margin appreadi. (Enter Sales mix [based on units} as a whole percentage and round Weighted-average CM per unit to two decimal places.) Contribution marginiunil Sales mix (based on units) Weightedaverage CM per unit Total fixed costs to be recovered Total units to breakeven Required 2 1" Smith Company can produce two types of carpet cleaners, Brighter and Cleaner. Data on these two products are as follows: Brighter Clam: Sales volume in units 400 600 Unit. sales price $ 1 , I] I] E! $ 1 , D 00 Unit. variable cost 2 I] D 'i' Di] The number of machine hours to produce one unit of Brighter is 1, while the number of machine hours for each unit of lCleaner is 2. Total fixed costs for the manufacture of both products are $295,000. Required: 1. Determine the breakeven point in total units for Smith Company, based on the assumption that the sales mix (on the basis of relative sales volume in units) remains constant. Use the weighted-average contribution margin approach. 2. At this breakeven level. how many units of each product must be sold? Due to rounding. the total breakeven units for Requirement 2 may differ slightly than in Requirement 1. 3. Using the Indirect approach, what is the overall breakeven point in sales dollars? Use the breakeven units computed in Requirement 1. Complete this question by enterlng your answers In the tails below. At this breakeven level, how many units of each product must be sold? Due to rounding, the total breekeven units for Requirement 2 may differ slightly then In Requirement 1. [Round your Final answers to the nearest whole unit.) - 6.. Required1 Required3 ') Smith Company can produce two types of carpet cleaners, Brighter and Cleaner. Data on these two products are as follows: Brighter Cleaner Sales volume in units 400 600 Unit sales price $ 1,000 $ 1,000 Unit variable cost 200 700 The number of machine hours to produce one unit of Brighter is 1, while the number of machine hours for each unit of Cleaner is 2. Total fixed costs for the manufacture of both products are $295,000. Required: 1. Determine the breakeven point in total units for Smith Company, based on the assumption that the sales mix (on the basis of relative sales volume in units) remains constant. Use the weighted-average contribution margin approach. 2. At this breakeven level, how many units of each product must be sold? Due to rounding, the total breakeven units for Requirement 2 may differ slightly than in Requirement 1. 3. Using the Indirect approach, what is the overall breakeven point in sales dollars? Use the breakeven units computed in Requirement 1. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using the Indirect approach, what is the overall breakeven point in sales dollars? Use the breakeven units computed in Requirement 1. (Do not round intermediate calculations. Round your final answer to the nearest whole dollar.) Overall breakeven point in sales dollarsStep by Step Solution
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