Jackie's Snacks sells fudge, caramels, and popcorn. It sold 12,000 units last year. Popcorn outsold fudge by a margin of 2 to 1. Sales of caramels were the same as sales of popcorn. Fixed costs for Jackie's Snacks are $14,000. Additional information follows:Productproduct unit sales price unit variable costfudge $5.00 $4.00caramels $8.00 $5.00popcorn $6.00 $4.50Breakeven sales in dollars for Jackie's Snacks is:(A) $8,250(B) $16,800(C) $39,600(D) $46,200

Question

contestada

Respuesta :

andromache andromache · Answer 1 · 2019-10-09T09:36:43+02:00

Answer:

(D) $46,200

Explanation:

In this question we use the formula of break-even point in dollars which is shown below:

= (Fixed expenses ) ÷ (Profit volume ratio)

where,

Contribution margin per unit = Selling price per unit - Variable expense per unit

So, the contribution margin per unit

For Fudge = $5 - $ = $1

For Caramels = $8 - $5 = $3

For Popcorn = $6 - $4.5 = $1.5

So, the total contribution margin per unit = $1 + $3 × 2 + $1.5 × 2 = $10

And, the total selling price per unit = $5 + $8 × 2 + $6 × 2 = $33

And, the profit volume ratio equals to

= (Total Contribution margin per unit ÷ total selling price per unit) × 100

= ($10 ÷ $33) × 100

= 30.30%

Now put these values to the above formula

So, the value would equal to

= $14,000 ÷ 30.30%

= $46,204