Fitch Ltd. produces lighting fixtures. For the upcoming period, the company has provided the following budget...

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Fitch Ltd. produces lighting fixtures. For the upcoming period, the company has provided the following budget information for two of its product lines: Sales (units) Sales Variable costs Contribution margin Deduct: product line fixed costs Product line operating profit (loss) Table lamps Floor lamps 100,000 $ 6,100,000 2,600,000 500,000 $ 52,000,000 22,500,000 3,500,000 29,500,000 2,700,000 28,200,000 $ 800,000 $ 1,300,000 Total 600,000 $ 58,100,000 25,100,000 33,000,000 30,900,000 $2,100,000 Assuming the sales mix remains as budgeted, how many table lamps must be part of the sales mix for Fitch to break even? Fitch Ltd. produces lighting fixtures. For the upcoming period, the company has provided the following budget information for two of its product lines: Sales (units) Sales Variable costs Contribution margin Deduct: product line fixed costs Product line operating profit (loss) Table lamps Floor lamps 100,000 $ 6,100,000 2,600,000 500,000 $ 52,000,000 22,500,000 3,500,000 29,500,000 2,700,000 28,200,000 $ 800,000 $ 1,300,000 Total 600,000 $ 58,100,000 25,100,000 33,000,000 30,900,000 $2,100,000 Assuming the sales mix remains as budgeted, how many table lamps must be part of the sales mix for Fitch to break even?

Answer rating: 100% (QA)

It is necessary to identify the contribution margin ratio for the table lamps before we can compute ... View the full answer