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 $ $1,500$ $ $800$ $ $100$

Medium$-$quality $85052080$

Three$-$quarters of the shops sales are medium$-$quality bikes. The shops annual fixed expenses are $$168,750.($In the following requirements, ignore income taxes.$)$

Required:

Compute the unit contribution margin for each product type.

What is the shops sales mix?

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

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

How many bicycles of each type must be sold to earn a target net income of $$101,250?$ Assume a constant sales mix.

Answer rating: 100% (QA)

Tims Bicycle Shop CVP Analysis 1 Unit Contribution Margin For each product type calculate the contribution margin per unit Contribution margin per uni... View the full answer