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MCS,PHD Argosy University/ Phoniex University/ Nov-2005 - Oct-2011
Professor Phoniex University Oct-2001 - Nov-2016
6-3Â
DO IT!
Snow Cap Springs produces and sells water filtration systems for homeowners.
Information regarding its three models is shown below.
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Units sold
Basic
750
Basic Plus
450
Premium
300
Total
1,500
Selling price
$250
$400
$800
Variable costs
$195
$288
$416
The company’s total fixed costs to produce the filtration systems are $165,480.
(a)Â Â Determine the sales mix as a function of units sold for the three products.
(b)Â Â Determine the weighted-average unit contribution margin.
(c)Â Â Determine the total number of units that the company must produce to break even.
(d)Â Â Determine the number of units of each model that the company must produce to break even.
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