Question: In a multi-product break-even analysis, we use a blended or weighted average contribution margin. Why must we use this fictitious number rather than actual contribution

In a multi-product break-even analysis, we use a blended or weighted average contribution margin. Why must we use this "fictitious" number rather than actual contribution margins in computing a multi-product break-even point?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

In a multiproduct breakeven analysis using a blended or weighted average contribution margin is necessary because it provides a more accurate represen... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

1. What is the total sales dollar amount for all products sold to customers in Nebraska (NE)? 2. What is the total sales dollar amount for all products sold to customers in Louisiana (LA)? 3. What is...

What are the assumptions used in CVP analysis and why do we make them? What role does sensitivity analysis play in CVP analysis? What possible benefits or risks do these pose for management? In a...

List three specific parts of the Case Guide, Objectives and Strategy Section (See below) that you had the most difficulty understanding. Describe your current understanding of these parts. Provide...

Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...

What are the assumptions used in CVP analysis and why do we make them? What role does sensitivity analysis play in CVP analysis? What possible benefits or risks do these pose for management? In a...

PLEASE FIND % CHANGE IN OPERATING INCOME (LAST QUESTION). (BLUE SQUARE) PLEASE DO 1,2,3 UNDER ADVISING CLIENT SHEET. PLEASE FIND % CHANGE IN OPERATING INCOME (LAST QUESTION). PLEASE DO #1,2,3 UNDER...

PLEASE HELP BY ENTERING EQUATIONS IN EXCEL FORMAT INTO EACH BOX. I'M HAVING A TON OF DIFFICULTY UNDERSTANDING WHICH EQUATIONS GO WHERE! THANK YOU :) After taking business classes, Jake, an avid...

Business Description After taking business classes, Jed, an avid poultry enthusiast, decided to start selling unique poultry supplies at trade shows. He has two products: Product 1: "Wash-it"- a egg...

directions: You have been hired by Jake to build a CVP model that will help him understand the impact of business conditions on his operating income. (See "Starting File" worksheet.) In your model,...

How do I calculate the margin of Safety in dollars? After taking business classes, Jake, an avid dog-lover, decided to start selling unique pet supplies at trade shows. He has two products: Product...

Hi there, I missed two weeks of school because of medical reasons. Can someone help me with this please? AutoSave . Off Jake's pet business - Saved Search Guillaume Etienne GE File Home Insert Page...

Write a balanced chemical equation (in acidic solution) for the reaction represented by the question mark on the lower arrow.18 Calculate E for the reaction.

Shannon's estimate for unicity distance (the length of ciphertext needed to deter- mine a key when the plaintext is an English message) is H(K)/R, where R is the per-character redundancy in English...

(12) 1. (x)[(Ax Bx) Cx] 2. (x)(Ax Cx) / (x)Bx Use the change of quantifi er rule together with the eighteen rules of inference to derive the conclusions of the following symbolized arguments. Do...

A telemarketing company has a special letter opening machine that opens and removes the contents of an envelope. If the envelope is fed improperly into the machine, the contents of the envelope may...

The lifetime, in weeks, of a certain type of transistor is known to follow a gamma distribution with mean 10 weeks and standard deviation 50 weeks. (a) What is the probability that the transistor...

Determine the height and diameter of a vertical flash drum for the conditions shown in Figure 7.48. Ibmol/h nC4 nC5 nC6 187.6 176.4 82.5 224.3F 102.9 psia Ibmol/h nC4 nC5 Cs 112.4 223.6 217.5 Figure...

The intensity of light with wavelength traveling through a diffraction grating with N slits at an angle is given by l() = N2 sin2k/k2, where k = ( Nd sin (/ and is the distance between adjacent...

A uniform sign of weight Fg and width 2L hangs from a light, horizontal beam, hinged at the wall and supported by a cable (Fig. P12.45). Determine (a) The tension in the cable and (b) The components...

6 Theory of Machines 5. A shaft carries five masses A, B, C, D and E which revolve at the same radius in planes which are equidistant from one another. The magnitude of the masses in planes A, C and...

For each of the following, indicate whether the statement is true or false. a. The main difference between job order and process costing systems is the amount of detail captured for each product. b....

Great Paint Company uses a process costing system. The following applies to materials for June: Materials are added halfway through the process. The company started 20,000 units. There were 2,000...

For each of the following items, select for the current period only one financial document that best describes where the item would appear: a. Budgeted statement of cash receipts and cash...

8. What can you say about neurons in the gut and heart?

1. What is your understanding of what ego means in the context of Transpersonal Leadership?

7. What is the latest thinking on how the claustrum connects to the cortex?