A company sells 3 products: A, B, and C. Its annual fixed costs average $70,000, and...

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A company sells 3 products: A, B, and C. Its annual fixed costs average $70,000, and its target operation income is $580,000. Each product's contribution margin ratio (CM%) and relative sales mix are shown below: Product A's CM% = 10% (50% of the sales mix) Product B's CM% = 15% (40% of the sales mix) Product C's CM% = 20% (10% of the sales mix) 1. The company's average contribution margin ratio is 15 %. 2. Blank 1 The amount of sales required to achieve the target operating income is $ 4333333 Blank 2 A company sells 3 products: A, B, and C. Its annual fixed costs average $70,000, and its target operation income is $580,000. Each product's contribution margin ratio (CM%) and relative sales mix are shown below: Product A's CM% = 10% (50% of the sales mix) Product B's CM% = 15% (40% of the sales mix) Product C's CM% = 20% (10% of the sales mix) 1. The company's average contribution margin ratio is 15 %. 2. Blank 1 The amount of sales required to achieve the target operating income is $ 4333333 Blank 2

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Solution to Requirement 1 Calculation of average Contribution margin ratio Pro... View the full answer