Waterways have a sales mix of sprinklers, valves, and controllers as follows:
· Annual expected sales:
Sale of sprinklers 460,000 units at $26.50
Sale of valves 1,480,000 units at $11.20
Sale of controllers 60,000 units at $42.50
· Variable manufacturing cost per unit:
Sprinklers $13.75
Valves $ 7.95
Controllers $29.75
· Fixed Manufacturing overhead cost (total) $760,000
· Variable selling and administrative expenses per unit:
Sprinklers $1.30
Valves $0.50
Controllers $3.41
· Fixed selling and administrative expenses (total) $1,600,000
Instructions
(a) Determine the sales mix based on unit sales for each product.
(b) Using the annual expected sales for these products, determine the weighted average unit contribution margin for these three products (Round to two decimal places.)
Assuming the sales mix remains the same, what is the break even point in units for these products