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Sparky Corporation sells 3 different products. Information about those products is as follows: Product A Product B Product C

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Answer #1

Correct answer---------3,250 Units

Working

Working Product A Product B Product C Total
A Price $            40.00 $          30.00 $     20.00
B Variable Cost per unit $            35.00 $          10.00 $     15.00
C = A - B Contribution Margin $               5.00 $          20.00 $       5.00
D Product Mix 10% 20% 70% 100.00%
E = C x D Weighted Average Contribution Margin $               0.50 $            4.00 $       3.50 $       8.00

.

A Total Fixed Cost plus profit $ 130,000.00
B Weighted Average Contribution Margin $               8.00
C = A/B Multi Product Break Even point              16,250
C x 20% Product B                 3,250
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