Break-Even Point and Target Profit Measured in Sales Dollars (Multiple Products). Advanced Products Company produces three different
Question:
Break-Even Point and Target Profit Measured in Sales Dollars (Multiple Products). Advanced Products Company produces three different CDs with the following annual data (these data are the same as the previous exercise).
Assume the sales mix remains the same at all levels of sales. Required: Round your answers to the nearest hundredth of a percent and nearest dollar where appropriate. (An example for percentage calculations is 0.434532 = 0.4345 = 43.45 percent; an example for dollar calculations is $378.9787 = $379.)
a. Using the information provided, prepare a contribution margin income statement similar to the one in
b. Calculate the weighted average contribution margin ratio.
c. Find the break-even point in sales dollars.
d. What amount of sales dollars is required to earn an annual profit of $200,000?
e. Assume the contribution margin income statement prepared in requirement a is the companys base case. What is the margin of safety in sales dollars?
Operations and Supply Chain Management
ISBN: 978-1118738542
8th edition
Authors: Roberta S. Russell, Bernard W. Taylor