Mathematics, 03.12.2021 16:30 kylahwells
Handy Home sells windows (80% of sales) and doors (20% of sales). The selling price of each window is $210 and of each door is
$520. The variable cost of each window is $130 and of each door is $360. Fixed costs are $480,000.
(1) Compute the weighted average contribution margin.
Sales mix
Contribution margin
Total per unit
Windows
Doors
20%
80%
Weighted average contribution margin
Il
(2) Compute the break-even point in units using the weighted average contribution margin.
Numerator:
Denominator:
Total fixed costs
Weighted-average contribution margin per unit
$
480,000
/
11
Break Even Units
Break Even Units
0
1
Unit sales at
break-even point
(3) Compute the number of units of each product that will be sold at the break-even point.
Sales mix
Number of units to break even
Windows
Doors
Total
Answers: 3
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