Question

Sales Mix and Break-Even Sales Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $510,400, and the sales mix is 60% bats and 40% gloves. The unit selling price and the unit variable cost for each product are as follows: Products Unit Selling Price Unit Variable Cost Bats $80 $60 Gloves 200 120 a. Compute the break-even sales (units) for both products combined. units b. How many units of each product, baseball bats and baseball gloves, would be sold at break-even point? Baseball bats units Baseball gloves units

Answer 1

Summary of answer

a. Break even sales if combined - 11,600 units

b. Break even sales if seperately sold

Bats - 15,312 units

Gloves - 2,552 units

Detailed working is attached below, please refer

Thanks

formula fixed cost Break even Salesz Contribution per unit en (units) a) Break-even combined: even sales if both products Sales mix = 60:40 a Particulars Amount C$ Unit Selling price Bate - $80X GOZ Gloves - $200 X 407_ 48 80 Less: Variable cost per unit Bates - $60X60% Gloves $120x40% (36) (48) Contribution per unit 44 Fixed Cost 510400 = Breaks Evep sales – Fixed cost Cunits) Contribution pou . 510900 44 = 11600 units

b) BEP (units) if produell sold Seperately Base ball Baseball Gloves Bate Unit. Selling price 80 2 00 Less: Variable Cost Contribution per unit Fixed Cost (510400 x 60:40) (60) 20 (120) 80 306240 204160_ Fixed cost BEP (units) Contribution per unit Di luin Bate Geloves - 306290 20 2204160 80 2 15312 units =255 2 units