Question
The x Company has three product lines of beltsA, B, and Cwith contribution margins of $2 ,$3 , and $4 , respectively. The president foresees
The x Company has three product lines of beltsA, B, and Cwith contribution margins of $2 ,$3 , and $4 , respectively. The president foresees sales of 240,000 units in the coming period, consisting of 24000 units of A, 120000units of B , and 96000 units of C. The company's fixed costs for the period are $ 351,000.
1. What is the company's breakeven point in units, assuming that the given sales mix is maintained? Begin by determining the sales mix. For every 1 unit of A, 5 2 3 units of B are sold, and 5 4 2 units of C are sold. What is the company's breakeven point in units, assuming that the given sales mix is maintained?
2. If the sales mix is maintained, what is the total contribution margin when 240000 units are sold? What is the operating income?
3. What would operating income be if 24000 units of A, 96000units of B, and 120000 units of C were sold? What is the new breakeven point in units if these relationships persist in the next period?
Thank you
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