# Question

Refer to the information in E6-20 for Juniper Corp. Suppose Juniper has improved its manufacturing process and expects total variable costs to decrease by 20 percent. The company expects sales revenue to remain stable at $300,000.

Percentage of Total Sales

Thermos A ... 35%

Thermos B ... 45

Thermos C ... 20

Required:

1. Calculate the new weighted-average contribution margin ratio.

2. Determine total sales that Juniper needs to break even if fixed costs after the manufacturing improvements are $62,400.

3. Determine the total sales revenue that Juniper must generate to earn a profit of $90,000.

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

Percentage of Total Sales

Thermos A ... 35%

Thermos B ... 45

Thermos C ... 20

Required:

1. Calculate the new weighted-average contribution margin ratio.

2. Determine total sales that Juniper needs to break even if fixed costs after the manufacturing improvements are $62,400.

3. Determine the total sales revenue that Juniper must generate to earn a profit of $90,000.

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

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