a college produces and sells two types of delivery for accounting classes, Daytime Delivery & Online...

a college produces and sells two types of delivery for accounting classes, Daytime Delivery & Online Delivery. The company records show the following monthly data relating to these two programs:

	Daytime			Online
Selling Price per Course	$350		$ 330
Variable Costs	$300		$ 100

Expected Monthly Sales	600		200

Total Monthly Fixed Cost (Common to Both)		$30,000

Determine the sales mix based on Sales units as a % (or decimal)

Daytime _________ Online __________

(a) Determine the weighted-average contribution margin ratio.

(b) Determine the monthly sales in $ to break even.

(c) Determine how the number of registrations of each type of program are sold at the breakeven point.

Round to a whole unit.

______________Daytime

________________Online

Expert Solution



	*Sales Mix*
		Day Time	Online	Total
	Expected Monthly sales	600	200	800
	Sales Mix	75%	25%	100%
		(600/800) X 100	(200/800) X 100

	*Weighted average contribution Margin Ratio*
		Day Time	Online	Total
A	Sales Price Per Course	350	330
B	Variable Expenses	300	100
C=A-B	Contribution Margin per unit	50	230
D=(C/A) X 100	Contribution Margin ratio	14%	70%
E	Expected Monthly sales	600	200	800
F	Sales Mix	75%	25%
G=E X F		11%	17%
	Weighted average contribution Margin Ratio	28%
		(11%+17%)

	*Break Even Sales in Dollars(Break Even Point)*
	Tota Fixed Cost	30000
	Weighted average contribution Margin Ratio	28%
	Break Even Sales in Dollars	106615
	(Total Fixed Cost/Weighted average Contribution Margin Ratio)

	*Breakdown of the break-even sales revenue:*
	(B-E point x Sales revenue Mix)
	Day Time (106615 x 75%)	79,961
	Online (106615 x 25%)	26,654
	Total	106,615

ekkarill92 answered 1 year ago

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