Question

Yard Tools manufactures lawnmowers, weed-trimmers, and chainsaws. Its sales mix and unit contribution margin are as follows.

		Sales Mix			Unit Contribution Margin
Lawnmowers		20	%		$33
Weed-trimmers		50	%		$22
Chainsaws		30	%		$41

Yard Tools has fixed costs of $4,544,800.

Compute the number of units of each product that Yard Tools must sell in order to break even under this product mix. (Use the Weighted-Average Unit Contribution Margin Ratio rounded to 2 decimal places e.g. 0.25 and round final answers to 0 decimal places, e.g. 2,510.)

Lawnmowers			units
Weed-trimmers			units
Chainsaws			units

Answer 1

Lawnmowers	30,400
Weed - trimmers	76,000
Chainsaws	45,600
Workings:
	Sales mix	Unit contribution margin	Average Unit contribution margin
	(i)	(ii)	(i) X (ii)
Lawnmowers	20%	$                      33	$                6.60
Weed - trimmers	50%	$                      22	$              11.00
Chainsaws	30%	$                      41	$              12.30
Total			$              29.90
Total Fixed costs	=	$       45,44,800
Break-even point in units	=	Total Fixed costs / Average Unit contribution margin
	=	$4544800 / $29.90
	=	1,52,000	units
	Sales mix	Break-even units	Attributable Break even units
	(i)	(ii)	(i) X (ii)
Lawnmowers	20%	1,52,000	30,400
Weed - trimmers	50%	1,52,000	76,000
Chainsaws	30%	1,52,000	45,600