FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- Clank Bicycles is a bicycle retailer that sells road bikes and mountain bikes. Mountain bikes accounts for 60% of the store’s total sales volume. The selling price and variable cost per unit are as follows: Road bike Mountain bike Selling price 4,700 3,400 Product cost 3,080 2,600 Sales commission 60 40 Annual fixed costs are $113,400. Ignore tax effects and assume a constant sales mix. Required: Calculate the break-even point in units and dollars. Calculate how many bicycles of each type needed to be sold to earn a target net profit of $340,200?Hint: Same formula as a single product, but divided by ‘weighted average unit contribution margin’ instead of ‘unit contribution margin’.arrow_forwardSuper Sales Company is the exclusive distributor for a high-quality knapsack. The product sells for $80 per unit and has a CM ratio of 40%. The company's fixed expenses are $360,000 per year. The company plans to sell 13,000 knapsacks this year. Required: 1. What are the variable expenses per unit? Variable expenses per unit 2. Use the equation method for the following: a. What is the break-even point in units and in sales dollars? Break-even point in units Break-even point in sales dollarsarrow_forwardVinu Bhaiarrow_forward
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