Sales Mix and Break-Even Analysis Megan Company has fixed costs of $2,269,800. T

Question

Sales Mix and Break-Even Analysis Megan Company has fixed costs of $2,269,800. The unit selling price, variable cost per unit, and contribution margin per unit for the company's two products are provided below. ProductSelling Price Variable Cost per Unit Contribution Margin per Unit $650 $410 $240 920 640 280 The sales mix for products Q and Z is 50% and 50%, respectively. Determine the break-even point in units of Q and Z. If required, round your answers to the nearest whole number a. Product Q units Product 2unts

Explanation / Answer

BEP ( units ) for the company as a whole = Fixed costs / Weighted avg. CM per unit

2269800 / ( 240 * 0.5 + 280 * 0.5 )

2269800 / 260 = 8730 units

Product Q = 8730 * 50 % = 4365 units

Product Z = 8730 * 50 % = 4365 units

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