Hi-Tech Incorporated produces two different products with the following monthly data:
|
Cell
|
GPS
|
Total
|
|
Selling price per unit
|
100
|
400
|
|
|
Variable cost per unit
|
40
|
240
|
|
|
Expected unit sales
|
21,000
|
9,000
|
30,000
|
|
Sales mix
|
70%
|
30%
|
100%
|
|
Fixed costs
|
|
|
$ 1,800,000
|
Assume the sales mix remains the same at all levels of sales.
Required:
a. Calculate the weighted average contribution margin per unit.
b. How many units in total must be sold to break even?
c. How many units of each product must be sold to break even?
d. How many units in total must be sold to earn a monthly profit of $180,000?
e. How many units of each product must be sold to earn a monthly profit of $180,000?