Question

Multiple-Product Breakeven Instructions Sales Mix and Break-Even Quantity Instructions Sales Mix and Break-Even Quantity Multiple-Product Breakeven 1 What is the sales mix of DVDs and equipment sets? S Cherry Blossom Products inc produces and sells yoga-training products how to DVDs and a basic equipment set blocks, strap and small piows, Last year, Cherry Blossom Products sold 13,500 DVDs and 4500 equipment sets Information on the two products is as follows 2 Compute the break-even quantity of each product The break even quantity for DVDs is Equipment Sets Price The break-even quantity for equipment sets is Variable cost per unit Total foxed cost is $84 920 Required: 1. What is the sales mix of DVDs and equipment sets? 2. Compute the break-even quantity of each product Check My Work

Answer 1

Sales Units Selling price Per unit Variable Cost Per unit Contribution Margin Per unit Sales Mix := 3:1,=(13500/18000, 4500/8000) CM* sales mix Weighted Average Unit Contribution Fixed cost Equipment DVDs Sets 13500 4500 8 25| 15 4 10 75% 25% 2.5 5.500000 84920 3 5.5 84920 15440 (Units) Weighted Average Unit Contribution Fixed Cost Compute the Break Even point in Units Break Even in Unit Sales =( Fixed Cost / CM Per unit) Answers Sales Mix = 3:1 Break Even Point DVD (15440*3/4) Equipment (15440*1/4) (3:1) 11580 Units 3860 Units