Determine the break-even point in units for the company

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Reference no: EM133123473

Question - A Company in Vaughn manufactures two products and gathered information about the two items as bellow:


Product MX15

Product LX20

Selling price per unit

$40

$60

Variable cost manufacturing cost per unit

16

22

Variable selling cost per unit

8

12

The company expects annual fixed manufacturing costs to be $109,160 and fixed selling costs to be $50,000. The firm's normal annual total sales are 14,000 units, of those 8,400 have been Product MX15 and the remainder are Product LX20.

Required -

1. Determine the break-even point in units for the company's products (i.e., show the number of units for each product: MX15 and LX20).

2. Determine the level of sales (in dollars) necessary to generate an operating income of $75,000.

Reference no: EM133123473

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