Sales Mix and Break-Even Analysis Olmstead Company has fixed costs of $459,200. The unit selling price, variable cost per unit, and contribution margin per unit for the company’s two products follow: Product  Selling Price  Variable   Cost per Unit Contribution MarginperUnit QQ               $40             $15                                      $25 ZZ                  60               25                                        35 The sales mix for Products QQ and ZZ is 70% and 30%, respectively. Determine the break-even point in units of QQ and ZZ. a. Product QQ b. Product ZZ

Managerial Accounting
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ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
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Chapter6: Cost-volume-profit Analysis
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Sales Mix and Break-Even Analysis

Olmstead Company has fixed costs of $459,200. The unit selling price, variable cost per unit, and contribution margin per unit for the company’s two products follow:

Product  Selling Price  Variable   Cost per Unit Contribution MarginperUnit
QQ               $40             $15                                      $25
ZZ                  60               25                                        35

The sales mix for Products QQ and ZZ is 70% and 30%, respectively. Determine the break-even point in units of QQ and ZZ.

a. Product QQ
b. Product ZZ 

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