Question

Crown Co. can produce two types of lamps, the Enlightner and Foglighter. The data on the two lamp models are as follows:

	Enlightner				Foglighter
Sales volume in units			500				400
Unit sales price		$	300			$	400
Unit variable cost			200				240
Unit contribution margin		$	100			$	160

It takes one machine hour to produce each product. Total fixed costs for the manufacture of both products are $90,000. Demand is high enough for either product to keep the plant operating at maximum capacity.

Assuming that sales mix in terms of dollars remains constant, what is the breakeven point in dollars? (Round intermediate calculations to 4 decimal places and final answer up to the nearest whole number.)

Multiple Choice

• $306,513.

• $118,365.

• $288,735.

• $945,667.

• $244,765.

Answer 1