Question

Mission Foods produces two flavors of tacos—chicken and fish—with the following characteristics.

	Chicken			Fish
Selling price per taco	$	3.80		$	4.70
Variable cost per taco		1.90			2.35
Expected sales (tacos)		202,000			302,000

The total fixed costs for the company are $109,000.

Required:

a. What is the anticipated level of profits for the expected sales volumes?

b. Assuming that the product mix would be 41 percent chicken and 59 percent fish at the break-even point, compute the break-even volume using weighted-average contribution margin.

c. If the product sales mix were to change to four chicken tacos for each fish taco, what would be the new break-even volume?

a. What is the anticipated level of profits for the expected sales volumes?

	Profit $983,700

b. Assuming that the product mix would be 41 percent chicken and 59 percent fish at the break-even point, compute the break-even volume using weighted-average contribution margin. (In your computations, round up the total units to break-even to the nearest whole number and round other intermediate calculations to 2 decimal places. Round your final answers up to the nearest whole unit.)

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	Break-even Volume Chicken tacos Fish tacos

c. If the product sales mix were to change to four chicken tacos for each fish taco, what would be the new break-even volume? (In your computations, round up the total units to break-even to the nearest whole number and round other intermediate calculations to 2 decimal places. Round your final answers up to the nearest whole unit.)

	Break-even Volume Chicken    tacos Fish tacos

Answer 1

Ans: Peretit. :-($3.80-81-90) x 200,000 +($4.70 - 12:35)X302.000 - $109,000 = $984,500 Chicken Break even Volumen 20,637 tecas 89698 tacos - fish Volume Chicken Pish Break even 43819 ! (0905 Wasperingat weighted Aug contribution margen per un'f a - 41% % ($3.80 - 81-90) +59 y. * (4.70 - $.35) = $2.1655] Total no. of chicken and fish tacos (x) to breakeven & Profit = (p-ux- $0 $2.16554 - $109,000 24 = 50, 335 (sounded) Chicken = 56,3358 41% = 20, 637 Pish 50.335 X 59y. 99,698

weighted Average Contribution margin fer unit: 2_804. (53-80 - $1.90) 4 204. (44.70-42.35) $1.99 Total no g chicken and fish tacos (21) to breakeven Boothite Co-V) x-f . $= $1.99 X - $109000 x=54,774 (sounded) Chicken : 80% X 54774 :43,819 fish 20% X54774 : 10955 I
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