Question

Sales Mix and Break-Even Sales Data related to the expected sales of laptops and tablets for Tech Products Inc. for the current year, which is typical of recent years, are as follows: Products Unit Selling Price Unit Variable Cost Sales Mix Laptops $190 $130 30% Tablets 520 240 70% The estimated fixed costs for the current year are $269,640. Required: 1. Determine the estimated units of sales of the overall (total) product, E, necessary to reach the break-even point for the current year. units 2. Based on the break-even sales (units) in part (1), determine the unit sales of both laptops and tablets for the current year. Laptops: units Tablets: units 3. Assume that the sales mix was 70% laptops and 30% tablets. Determine the estimated units of sales of the overall product necessary to reach the break-even point for the current year. units Why is it so different? The break-even point is higher in this scenario than in part (1) because the sales mix is weighted more heavily toward the product with the lower contribution margin per unit of product.

Answer 1