Question
Suppose that Head-First Company now sells both bicycle helmets and motorcycle helmets. The bicycle helmets are priced at $77 and have variable costs of $45
Suppose that Head-First Company now sells both bicycle helmets and motorcycle helmets. The bicycle helmets are priced at $77 and have variable costs of $45 each. The motorcycle helmets are priced at $230 and have variable costs of $135 each. Total fixed cost for Head-First as a whole equals $66,500 (includes all fixed factory overhead and fixed selling and administrative expense). Next year, Head-First expects to sell 5,200 bicycle helmets and 2,080 motorcycle helmets.
Required: | |
1. | Form a package of bicycle and motorcycle helmets based on the sales mix expected for the coming year. |
2. | Calculate the break-even point in units for bicycle helmets and for motorcycle helmets. |
3. | Check your answer by preparing a contribution margin income statement. |
1. Form a package of bicycle and motorcycle helmets based on the sales mix expected for the coming year.
Product | Price | Unit Variable Cost | Unit Contribution Margin | Sales Mix | Package Contribution Margin | ||||
Bicycle helmet | |||||||||
Motorcycle helmet | |||||||||
Package total | Points: 6 / 11 Feedback Check My WorkSee Cornerstone 4.7. 2. Calculate the break-even point in units for bicycle helmets and for motorcycle helmets.
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3. Check your answer by preparing a contribution margin income statement. Refer to the list of Amount Descriptions for the exact wording of text items within your income statement.
Question not attempted.
Score: 0/51
Head-First Company |
Contribution Margin Income Statement |
At Break-Even Point |
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