Question

Hi, I'm in managerial accounting and I'm struggling with this question.

Personal Electronix sells iPads and iPods. The business is divided into two divisions along product lines. CVP income statements for a recent quarter’s activity are presented below.

iPad Division
iPod Division
Total
Sales       $806,400       $473,600       $1,280,000
Variable costs       580,608       265,216       845,824
Contribution margin       $225,792       $208,384       434,176
Fixed costs                       137,376
Net income                       $296,800

Find: Sales Mix Percentage for iPod and iPad division

Unit contribution margin ratio for each division

Weighted Avg Contribution margin ratio for each division

Company's break even point in dollars

Break even sales

Answer 1

• All working forms part of the answer
• Amounts are in $

	iPad Division	iPod Division	Total
Sales	$806400	$473600	$1280000
Sales Mix Percentage	63% [806400/1280000]	37% [473600/1280000]

		iPad Division	iPod Division
A	Contribution margin	$225792	$208384
B	Sales	$806400	$473600
C=A/B	Contribution Margin ratio	28%	44%
		iPad Division	iPod Division	Total
A	Contribution Margin ratio	28.00%	44.00%
B	Sales Mix Percentage	63.00%	37.00%
C=A x B	Weighted Average Contribution margin ratio	17.64%	16.28%	33.92%
A	Fixed Costs	$137376
B	Weighted Average Contribution margin ratio	$33.92%
C=A/B	Break Even point in Dollar Sales	$405000
D=C x 63%	iPad Division Break Even Sales	$255150
E= C x 37%	iPod Division Break Even Sales	$149850