Smuthers Company manufactures and sells three products. Selling price and variable cost data for the models are as follows:
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Yellow |
Blue |
Red |
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Unit selling price |
$36 |
840 |
$44 |
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Unit variable costs |
26 |
30 |
36 |
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Contribution margin |
$10 |
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Sales mix |
1 |
2 |
3 |
Instructions
(a) Compute the break-even point in units, assuming the total fixed costs are $320,004.
(b) Prove the correctness of your answer.
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