Yard Tools manufactures lawnmowers, weed-trimmers, and chainsaws. Its sales mix

Question

Yard Tools manufactures lawnmowers, weed-trimmers, and chainsaws. Its sales mix and contribution margin per unit are as follows.

Contribution Margin per Unit

Yard Tools has fixed costs of $6,477,860.

Compute the number of units of each product that Yard Tools must sell in order to break even under this product mix.

Lawnmowers ____________ units?

Weed-trimmers ___________ units?

Chainsaws ____________ Units?

Contribution Margin per Unit

Explanation / Answer

Sales mix percentage Contribution margin per unit weighted average contribution margin Lawn mowers 20% 40 8 Weed trimmers 50% 30 15 Chain Saws 30% 50 15 38 Total Break even sales in units = $6,477,860/38 = 170,470 units Sales Mix Total Break even sales in units Sales units Needed Lawn mowers 20% 170470 34094 Weed trimmers 50% 170470 85235 Chain Saws 30% 170470 51141 170470 Lawn mowers 34094 Units Weed trimmers 85235 Units Chain Saws 51141 Units

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