Exercise 7-29 Retail; CVP Analysis with Multiple Products (LO 7-1, 7-2, 7-5) Tims Bicycle Shop sells 21-speed bicycles. For purposes of a cost-volume-profit analysis, the shop owner has divided sales into two categories, as follows: Product Type Sales Price Invoice Cost Sales Commission High-quality $ 1,850 $ 840 $ 100 Medium-quality 920 620 40 Three-quarters of the shops sales are medium-quality bikes. The shops annual fixed expenses are $270,400. (In the following requirements, ignore income taxes.) Required:

1. Compute the unit contribution margin for each product type.

2. What is the shops sales mix?

3. Compute the weighted-average unit contribution margin, assuming a constant sales mix.

4. What is the shops break-even sales volume in dollars? Assume a constant sales mix.

5. How many bicycles of each type must be sold to earn a target net income of $126,750? Assume a constant sales mix.