Tom’s Winter Gear Company sells hats for men andboys. The average selling price
ID: 2433447 • Letter: T
Question
Tom’s Winter Gear Company sells hats for men andboys. The average selling price and variable cost for eachproduct are as follows:
Men’s Boys
Sellingprice $28.80 $24.00
Variablecost $20.42 $16.80
Total fixedcosts $38,400
Assume the sales mix is 2 men’s hats for each boy’shat:
a. What is the weighted revenue perunit of composite average product, the weighted average variablecost, and the weighted contribution margin per unit of averageproduct?
b. What is the break-even point inunits for each type of hat?
c. What is the operating income,assuming sales total 9,000 hats?
Explanation / Answer
x.;rong>a.