Problem
Clyde's Comfort, Inc.
Clyde's Comfort, Inc., produces and sells four different sizes of dog beds: Small, Medium, Large, and Extra Large. Annual information regarding the four types of dog beds is shown below:
|
|
Small
|
Medium
|
Large
|
X-Large
|
|
Sales volume (# of beds)
|
40,000
|
80,000
|
70,000
|
10,000
|
|
Price per bed
|
$35
|
$40
|
$50
|
$60
|
|
VC per bed
|
$21
|
$24
|
$28
|
$34
|
Total Fixed costs for the entire firm are $1,633,500 per year.
Using a per unit weighted average contribution margin (WACM) based on the information above, calculate the total number of units that the firm must sell annually to break-even.