Sales Mix and Break-Even Sales
Data related to the expected sales of snowboards and skis for Winter Sports Inc. for the current year, which is typical of recent years, are as follows:
Products Unit Selling Price Unit Variable Cost Sales Mix Snowboards $210 $140 20% Skis 540 250 80%
The estimated fixed costs for the current year are $280,440.
Instructions:
1. Determine the estimated units of sales of the overall product 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 snowboards and skis for the current year.
Snowboards _________________ units Skis _________________ units
3. Assume that the sales mix was 80% snowboards and 20% skis. Determine the estimated units of sales of the overall product necessary to reach the break-even point for the current year.
_________________ units
4. Based upon the break-even sales (units) in part (3), determine the unit sales of snowboards and skis for the current year.
Snowboards _________________ units Skis _________________ units
5. The overall enterprise break-even point _________________ from (1) to (3) because the sales mix is weighted more toward the product with the _________________ contribution margin per unit of product.
Sales Mix and Break-Even Sales
Data related to the expected sales of snowboards and skis for Winter Sports Inc. for the current year, which is typical of recent years, are as follows:
| Products | Unit Selling Price | Unit Variable Cost | Sales Mix | |||
| Snowboards | $210 | $140 | 20% | |||
| Skis | 540 | 250 | 80% | |||
The estimated fixed costs for the current year are $280,440.
Instructions:
1. Determine the estimated units of sales of the overall product 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 snowboards and skis for the current year.
| Snowboards | _________________ units |
| Skis | _________________ units |
3. Assume that the sales mix was 80% snowboards and 20% skis. Determine the estimated units of sales of the overall product necessary to reach the break-even point for the current year.
_________________ units
4. Based upon the break-even sales (units) in part (3), determine the unit sales of snowboards and skis for the current year.
| Snowboards | _________________ units | |
| Skis | _________________ units |
5. The overall enterprise break-even point _________________ from (1) to (3) because the sales mix is weighted more toward the product with the _________________ contribution margin per unit of product.
Related questions
4. TopsCompany sells Products D and E and has made the following estimatesfor the coming year:
Product | Unit Selling Price | Unit Variable Cost | Sales Mix |
D | $30 | $24 | 60% |
E | 70 | 56 | 40 |
Fixed costs are estimated at $202,400.Determine (a) the estimated sales in units of the overall productnecessary to reach the break-even point for the coming year, (b)the estimated number of units of each product necessary to be soldto reach the break-even point for the coming year, and (c) theestimated sales in units of the overall product necessary torealize an operating income of $119,600 for the coming year.
1. Sales Mix and Break-Even Sales
Dragon Sports Inc. manufactures and sells two products, baseballbats and baseball gloves. The fixed costs are $836,000, and thesales mix is 30% bats and 70% gloves. The unit selling price andthe unit variable cost for each product are as follows:
| Products | Unit Selling Price | Unit Variable Cost | ||
| Bats | $70 | $50 | ||
| Gloves | 180 | 110 | ||
a. Compute the break-even sales (units) forboth products combined.
units
b. How many units of each product, baseballbats and baseball gloves, would be sold at break-even point?
| Baseball bats | units |
| Baseball gloves | units |
2.
Break-Even Sales
Currently, the unit selling price of a product is $240, the unitvariable cost is $200, and the total fixed costs are $476,000. Aproposal is being evaluated to increase the unit selling price to$270.
a. Compute the current break-even sales(units).
units
b. Compute the anticipated break-even sales(units), assuming that the unit selling price is increased to theproposed $270, and all costs remain constant.
units
