Juniper Corp. makes three models of insulated thermos. Juniper has $400,000 in total revenue and total variable

Question:

Juniper Corp. makes three models of insulated thermos. Juniper has $400,000 in total revenue and total variable costs of $240,000. Its sales mix is given below:

Percentage of Total Sales

Thermos A ... 35%

Thermos B ... 45

Thermos C ... 20

Required:

1. Calculate the (overall) weighted-average contribution margin ratio.

2. Determine the total sales revenue Juniper needs to break even if fixed costs are $80,000.

3. Determine the total sales revenue needed to generate a profit of $90,000.

4. Determine the sales revenue from each product needed to generate a profit of $90,000.

Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...