x Brief Exercise 19-8 Your answer is incorrect. Try again. NoFly Corporation sells three different models...

Brief Exercise 19-8


	Your answer is incorrect. Try again.

NoFly Corporation sells three different models of a mosquito “zapper.” Model A12 sells for $58 and has variable costs of $41. Model B22 sells for $102 and has variable costs of $75. Model C124 sells for $413 and has variable costs of $316. The sales mix of the three models is A12, 58%; B22, 27%; and C124, 15%.

If the company has fixed costs of $208,269, how many units of each model must the company sell in order to break even? (Round Per unit values to 2 decimal palces, e.g. 15.25 and final answers to 0 decimal places, e.g. 5,275.)

Model
A12
B22
C124

Total break-even

units

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Solutions

Expert Solution

	A12	B22	C124
Unit selling price	$ 58	$ 102	$ 413
Unit variable cost	$ 41	$ 75	$ 316
Unit contribution margin	$ 17	$ 27	$ 97
Sales mix	58%	27%	15%
Weighted average CM = 1758%+2727%+97*15% =	$ 31.70
Break even point in composite units = Fixed costs/Weighted average CM per unit = 208269/31.70 =	6570	Composite Units
Number of units of individual products	A12	B22	C124	`Total
to be sold = 6570*% in sales mix =	3811	1774	986	6570

ekkarill92 answered 1 year ago

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