Suppose

240,000

units are sold but only

40,000

of them are deluxe. Compute the operating income. Compute the breakeven point in units. Compare your answer with the answer to requirement 1. What is the major lesson of this problem?

Compute the operating income if

240,000

units are sold but only

40,000

of them are deluxe.

	Standard Carrier	Deluxe Carrier	Total
Units sold
Revenues at $30 and $38 per unit
Variable costs at $24 and $28 per unit
Contribution margin
Fixed costs
Operating income

Below is requirment 1 which hopefully should help with this problem

Compute the breakeven point in units, assuming that the company achieves its planned sales mix.

Begin by determining the sales mix. For every 1 deluxe unit(s) sold,

3

standard units are sold.

Part 2

Determine the formula used to calculate the breakeven point when there is more than one product sold. Then, enter the amounts in the formula to calculate the breakeven point.

Fixed costs

Contribution margin per bundle

=

Breakeven point in bundles

Part 3

$1,050,000

$28

=

37,500

Part 4

The breakeven point is

112,500

standard units and

37,500

deluxe units.