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Assume MIX Inc. has sales volume of $1,198,000 for two products with May sales and contribution margin ratios as follows:
Product A: Sales $466,000; Contribution Margin Ratio 30%
Product B: Sales $732,000; Contribution Margin Ratio 60%
Required: Assume MIX's fixed expenses are $302,000. Calculate the May total contribution margin, operating income, average contribution margin ratio, and breakeven sales volume. (Round "Average contribution margin ratio" answer to 2 decimal places. Round up "Breakeven sales volume" answer to nearest whole dollar.)
Total contribution margin
Operating income
Average contribution margin ratio
Breakeven sales volume

Respuesta :

jepessoa

Answer:

total contribution margin = $579,000

operating income = $277,000

average contribution margin ratio = 48.33%

break even sales volume = $624,870.68

Explanation:

Product A: Sales $466,000; Contribution Margin Ratio 30%

Product B: Sales $732,000; Contribution Margin Ratio 60%

Mix's fixed expenses are $302,000

total contribution margin = ($466,000 x 30%) + ($732,000 x 60%) = $139,800 + $439,200 = $579,000

weighted contribution margin = (466/1198 x 30%) + (732/1198 x 60%) = 11.67% + 36.66% = 48.33%

break even sales volume = $302,000 / 48.33% = $624,870.68

operating income = $579,000 - $302,000 = $277,000

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