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The XYZ Company has three major products, whose contribution margins are shownbelow in Table 1.1. Table 1.1.  Presents description of the mixed products and related contribution margin   Description Product A B C Sales Price $ 13 $12 $6.5 Variable cost per unit 8 6 4 CM/Unit 5 6 2.5 Total fixed costs are $100,000. Question (a) the break-even point in units in total and for each product if the three products are sold in the proportions of 30%,50%, and 20%, and  (b)the break-even point in total and for each product if the sales mix ratio changes to 50%, 30%, and 20%

The XYZ Company has three major products, whose contribution margins are shownbelow in Table 1.1. Table 1.1.  Presents description of the mixed products and related contribution margin   Description Product A B C Sales Price $ 13 $12 $6.5 Variable cost per unit 8 6 4 CM/Unit 5 6 2.5 Total fixed costs are $100,000. Question (a) the break-even point in units in total and for each product if the three products are sold in the proportions of 30%,50%, and 20%, and  (b)the break-even point in total and for each product if the sales mix ratio changes to 50%, 30%, and 20%

EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter14: Capital Structure Management In Practice
Section14.A: Breakeven Analysis
Problem 7P
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  1. The XYZ Company has three major products, whose contribution margins are shownbelow in Table 1.1.

Table 1.1.  Presents description of the mixed products and related contribution margin

 

Description

Product

A

B

C

Sales Price

$ 13

$12

$6.5

Variable cost per unit

8

6

4

CM/Unit

5

6

2.5

Total fixed costs are $100,000.

Question

(a) the break-even point in units in total and for each product if the three products are sold in the proportions of 30%,50%, and 20%, and

 (b)the break-even point in total and for each product if the sales mix ratio changes to 50%, 30%, and 20%

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