Answer:
Break Even Point (in Dollar Sales) = Fixed Cost / Contribution Margin Ratio
Standard Racket:
Contribution Margin per Unit = Selling Price per Unit – Variable
Cost per unit
Standard’s Variable Cost per unit = $21.40 + $2.45 = $23.85
Standard’s Contribution Margin per Unit = $47.70 - $23.85
Standard’s Contribution Margin per Unit = $23.85
Weight of Standard Racket Sale for the month of April = 5,000 / 8,000 = 62.50%
Deluxe Racket:
Contribution Margin per Unit = Selling Price per Unit – Variable
Cost per unit
Deluxe’s Variable Cost per unit = $28.10 + $5.50 = $33.60
Deluxe’s Contribution Margin per Unit = $84.00 - $33.60
Deluxe’s Contribution Margin per Unit = $50.40
Weight of Deluxe Racket Sale for the month of April = 3,000 / 8,000 = 37.50%
Weighted Contribution Margin for the month of April = (0.625 *
23.85) + (0.375 * 50.40)
Weighted Contribution Margin for the month of April = 14.90625 +
18.90
Weighted Contribution Margin for the month of April = $33.80625
Weighted Sales = (0.625 * 47.70) + (0.375 * 84.00)
Weighted Sales = 29.8125 + 31.50 = $61.3125
Weighted Contribution Margin Ratio = 33.80625 / 61.3125 *
100
Weighted Contribution Margin Ratio = 0.551376
Break Even Point (in Dollar Sales) = 258,000 / 0.551376
Break Even Point (in Dollar Sales) =
$467,920.28
19 Athletic Sports, Inc., produces high-quality sports equipment. The company's Racket Division manufactures two tennis rackets...
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