Question - Dixie Candle Supply makes candles. The sales mix (as a percentage of total dollar sales) of its three product lines is birthday candles 30%, standard tapered candles 50%, and large scented candles 20%. The contribution margin ratio of each candle type is shown below.
Candle Type Contribution Margin Ratio
Birthday 20%
Standard tapered 30%
Large scented 40%
What is the weighted-average contribution margin ratio?
If the company's fixed costs are $377,000 per year, what is the dollar amount of each type of candle that must be sold to break even?