Company planned normal operation level $(10,000$ h$)$ sales revenues and costs for the $3$rd quarter of $2023$ are as follows $($euros$)$:

Total $|$ Product $1|$ Product $2$

Sales Revenues $|400,000|160,000|240,000$

Direct Materials $|110,000|40,000|70,000$

Direct Labor $|80,000|30,000|50,000$

Variable Overheads $|120,000|48,000|72,000$

Fixed Direct Costs $|3,500|2,000|1,500$

Contribution Margin $|86,500|40,000|46,500$

Fixed Overheads:

Depreciation $|25,000$

Other $|30,000$

Profit Before Taxes $|31,500$

a$)$ What are the break$-$even points for the products and the company?

c$)$ How large must the sales be in the third quarter of $2023,$ so that the profit after taxes would be

$50000$ euros$/$year$,$ if the tax rate is $20\%$ and the company's contribution margin $\%$ is $25\%.$

Answer rating: 100% (QA)

ANSWER To find the breakeven point for the products and the company we need to determine the sales volume at which total revenue equals total costs Fo... View the full answer