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Calculate the combine weighted average contribution

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Reference no: EM132590957

Bubble Bubble (BB) sells two version of bubble tea, BB1 and BB2 respectively. The following are BB monthly operating information:

                                                    BB1                   BB2

Price                                    RM 8/unit     RM 12/unit

Variable cost/unit                    RM 2/unit        RM 3/unit

Monthly expected sales            1,500 cups     1,000 cups

Monthly fixed costs RM15,000

Question A. Calculate the combine weighted average contribution margin per unit.

Question B. Calculate how many total combine units of BB1 and BB2 need to sell to break-even.

Question C. Calculate how many BB1 and how many BB2 to sell each month to generate a monthly before tax profit of RM 5,000.

Question D. Describe the assumptions when doing break-even analysis for multiple products and explain why those assumptions reasonably reflect the real situation in the short term.

Reference no: EM132590957

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