The Jenkins Company has three product lines of mugs-A, B, and C- with contribution margins of $6,$4, and $3, respectively. The president foresees sales of 252,000 units in the coming period, consisting of 36,000 units of A, 144,000 units of B and 72,000 units of C. The company's fixed costs for the period are $728,000.

1.	What is the company's breakeven point in units, assuming that the given sales mix is maintained? For every 1 unit of Product A, __________ units of Product B, and __________ units of Product C are sold.
2.	If the sales mix is maintained, what is the total contribution margin when 252,000 units are sold? What is the operating income?
3.	What would operating income be if the company sold 36,000 units of A, 72,000 units of B, and 144,000 units of C? What is the new breakeven point in units if these relationships persist in the next period?
4.	Comparing the breakeven points in requirements 1 and 3, is it always better for a company to choose the sales mix that yields the lower breakeven point? Explain.

Answer rating: 100% (QA)

Answer 1 Sales Mix of Product A B and C is 36000 144000 72000 or 142 Contr... View the full answer