Question

2. Ralph Co. produces commercial printers. One is the regular model, a basic model that is designed to copy and print in black and white. Another model, the deluxe model, is a color printer-scanner-copier. For the coming year, Ralph expects to sell 90,000 regular models and 22,500 deluxe models. A segmented income statement for the two products is as follows. Regular Model Deluxe Model Total $ 13,500,000 $ 12,150,000 $ 25,650,000 Sales Variable expenses Contribution margin $ Fixed expenses 9,000,000 4,500,000 $ 1,200,000 7,290,000 16,290,000 4,860,000 9,360,000 1,060,000 2,260,000 Common fixed costs 1,280,160 Operating income $ 3,300,000 $ 3,800,000 $5,819,840 Required (1) Compute the number of regular models and deluxe models that must be sold to break even. (2) Compute the break-even in sales.

PLEASE CHECK ANSWERS AND PROVID ME STEP-BY-STEP SOLUTIONS: sales mix = 4:1

(1)regular model: 34,040 units; deluxe model: 8,510 units

(2)$9,701,400

Answer 1