Question

Handy Home sells windows and doors in the ratio of 7:3 (windows:doors). The selling price of each window is $105 and of each door is $255. The variable cost of a window is $65.00 and of a door is $177.50. Fixed costs are $640,625. (Enter your "per unit" values in two decimal places.) (1) Determine the selling price per composite unit. Quantity Selling Price per unit Total per composite unit Windows Doors (2) Determine the variable costs per composite unit. Quantity Variable costs per unit Total per composite unit Windows Doors Contribution margin per composite unit $ 0,00 0.00 Contribution margin (3) Determine the break-even point in composite units. Choose Numerator: Choose Denominator: Break Even Units Break even units 0 (4) Determine the number of units of each product that will be sold at the break-even point. br posite units to even. Number Quantity Unit sales at break-even point Windows (3) Determine the break-even point in composite units. Choose Denominator: Choose Numerator: / Break Even Units Break even units C (4) Determine the number of units of each product that will be sold at the break-even point. Quantity Number of composite units to break even. Unit sales at break-even point Windows Doors

Answer 1

1.Selling price per composite Unit

	Qty	Selling Price per Unit	Total per composite unit
Windows	0.7	105	73.5
Doors	0.3	255	76.5
			150

2.Variable cost

	Qty	VC per Unit	Total
Windows	0.7	65	45.5
Doors	0.3	177.50	53.25
			98.75

3.Selling price per composite units = $150

Variable cost per composite unit = $98.75

Contribution Margin per Composite Unit = $51.25

3.Break even point in units = Fixed costs/CM per unit

= 640,625/51.25

= 12,500 units

4.Each product:

	Qty	Number of units	Unit Sales
Windows	0.7	12,500	8,750
Doors	0.3	12,500	3,750
			12,500