Question
Veejay Golf Accessories sells golf shoes, gloves, and a laser-guided range-finder that measures distance. Shown below are unit cost and sales datas: Pairs of Shoes
Veejay Golf Accessories sells golf shoes, gloves, and a laser-guided range-finder that measures distance. Shown below are unit cost and sales datas:
Pairs of Shoes | Pairs of Gloves | Range-Finder | |
Unit sales price | $100 | $30 | $270 |
Unit variable costs | $60 | $10 | $200 |
Unit contribution margin | $40 | $20 | $70 |
Sales mix | 40% | 50% | 10% |
Fixed costs are $660,000.
Use the information provided to answer the following questions: show your work. a) What is the weighted-average contribution margin per unit?
b) What is the break-even point in terms of total units sold and units sold of each product?
c) The company's tax rate is 25%. What is the target profit before tax that Veejay Golf Accessories will require if the company wants to earn a target profit after tax of $792,000?
d) To earn the required target profit after tax of $792,000, how many units must Veejay Golf sell in terms of total units sold and units sold of each product?
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