Using a Computer Spreadsheet to Solve Multiple- Product Break-Even: Varying Sales Mix More-Power Company has projected sales of 75,000 regular sanders and 30,000 mini-sanders for next year. The projected income statement is as follows: Regular Sander Mini-Sander Total Sales $3,000,000 $1,800,000 $4,800,000 Less: Variable expenses 1,800,000 900,000 2,700,000 Contribution margin $1,200,000 $900,000 $2,100,000 Less: Direct fixed expenses 700,000 250,000 450,000 $450,000 Product margin $950,000 $1,400,000 Less: Common fixed 600,000 expenses $800,000 Operating income Required: 1. For each of the following possible sales mixes, calculate operating income: Regular Sander Mini-Sander 37,500 75,000 а. b. 60,000 60,000 30,000 90,000 C. d. 30,000 60,000 Operating Income а. b. C. d. 2. Calculate the break-even units for each product for each of the preceding sales mixes. Round the number of break-even packages to two decimal places (and use this figure for intermediate calculations). Round the number of break-even regular and mini-sanders to the nearest whole unit. b a C Break-even packages Break-even regular sanders Break-even mini-sanders

Using a Computer Spreadsheet to Solve Multiple- Product Break-Even: Varying Sales Mix More-Power Company has projected sales of 75,000 regular sanders and 30,000 mini-sanders for next year. The projected income statement is as follows: Regular Sander Mini-Sander Total Sales $3,000,000 $1,800,000 $4,800,000 Less: Variable expenses 1,800,000 900,000 2,700,000 Contribution margin $1,200,000 $900,000 $2,100,000 Less: Direct fixed expenses 700,000 250,000 450,000 $450,000 Product margin $950,000 $1,400,000 Less: Common fixed 600,000 expenses $800,000 Operating income Required: 1. For each of the following possible sales mixes, calculate operating income: Regular Sander Mini-Sander 37,500 75,000 а. b. 60,000 60,000 30,000 90,000 C. d. 30,000 60,000 Operating Income а. b. C. d. 2. Calculate the break-even units for each product for each of the preceding sales mixes. Round the number of break-even packages to two decimal places (and use this figure for intermediate calculations). Round the number of break-even regular and mini-sanders to the nearest whole unit. b a C Break-even packages Break-even regular sanders Break-even mini-sanders

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 32P: More-Power Company has projected sales of 75,000 regular sanders and 30,000 mini-sanders for next...

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