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gnment/takeAssignmentMain dožinvoker assignmentsätakeAssignmentSessionLocatorsassignment-take8inprogress -false Calculato Print m Sales Mix and Break-Even Sales Dsta reiated to the expected sales of leptoos and tablets for Tech Products Inc. for the current year, which is typical of recent years, are as follows: Products Unit Selling Price Unit Variable Cost Sales Mix Laptops $1,000 $500 600 300 The estimated fixed costs for the current year are $6,384 Required: 1. Determine the estimated units of sales of the oeral (tora product E. necessary to reach the break-even point for the current year 2. Based on the break-even sales (units) in pert(), determine the unit sales of both laptops and tablets for the current year Laptops 3. Assume that the sales mix was 60% laptops and 40% tablets. Compare the breakeven t with that in part (1) why is it so diferent? The break-even point is with the higher Y in this scenario than in part (1) because the sales mix is of product. toward the product BANG &O;

Explanation / Answer

1 Computation of estimated sales of overall product necessary to reach the break even point of current year: Sales = ($1,000 X 40%) + ($600 X 60%) = $        760 Less: Variable cost = ($500 X 40%) + ($300 X 60%) = $        380 Unit contribution margin = = $        380 Break even sales = Fixed cost / Unit contribution margin = $63,84,000 / $380 =        16,800 units 2 Calculation of Break even sales in units Laptops = 16,800 units X 40% =         6,720 units Tablets = 16,800 units X 60% =      10,080 units 3 Computation of break even point with new sales mix 60:40 Sales = ($1,000 X 60%) + ($600 X 40%) = $        840 Less: Variable cost = ($500 X 60%) + ($300 X 40%) = $        420 Unit contribution margin = = $        420 Break even sales = Fixed cost / Unit contribution margin = $63,84,000 / $420 =        15,200 units The break even point is less in this scenario than in part (1) because the sales mix is greater toward the product with the higher unit contribution margin of product.

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