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Davis Exterminating Company performs a wide variety of past control services. George Davis, the owner, has been examining the following forecasts for 200X. Type of Expected Dollar Contribution Service Volume for 200X Margin Percentage Termites $120,000 60% Lawn pests 90,000 50% Interior pests 90.000 70% Total fixed costs are expected to be $140.000 in 200X
Required
Question 1. What is the weighted-average contribution margin percentage?
Question 2. What profit should Davis earn?
Question 3. The actual sales mix turned out to be 20% termites, 30% lawn pests, and 50% interior pests. Total actual sales were $300.000 and total fixed costs were $140.000. Determine the actual weighted-average contribution margin percentage and profit.
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