Solution-How do calculate in sales units the margin of

How do calculate in sales units the margin of safety for ipm

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Reference no: EM132690628

International Printer Machines (IPM) builds three computer printer models: Alpha, Beta, and Gamma. Information for these three products is as follows:

	Alpha	Beth	Gamma	Total
Selling price per unit	$250	$400	$1 500
Variable cost per unit	$80	$200	$800
Expected unit sales (annual)	12,000	6,000	2,000	20,000
Sales mix	50 percent	40 percent	10 percent	100 percent

Total annual fixed costs are $5,000,000. Assume the sales mix remains the same at all levels of sales.

Required:

Question a) Calculate the weighted average unit contribution margin, assuming a constant sales mix.

Question b) How many units of each printer must be sold to break even?

Question c) i) Explain what is margin of safety

ii) Calculate in sales units the margin of safety for IPM, assuming projected sales are 25,000 units?

Reference no: EM132690628

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How do calculate in sales units the margin of safety for ipm

Reference no: EM132690628

Reference no: EM132690628

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