7. WonderFood is a multi-product company that makes three types of cereal. Following table shows the sales price, variable cost per unit and units sold of each product: Price per Unit Variable Cost per Туре 1 $5 $10 Туре 2 $7.50 $13 Туре 3 $9 $15 Unit Unit Sold 2000 1500 1300 a. Calculate the separate contribution margin ratio for each product b. Calculate the weighted-average contribution margin ratio of the company as a whole. c. If the company's fixed costs are $100, 000 per annum, calculate the breakeven distribution of products.

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 19MC: A company sells two products, Model 101 and Model 202. For every one unit of Model 101, they sell...
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7.
cereal. Following table shows the sales price, variable cost per unit and units sold
of each product:
WonderFood is a multi-product company that makes three types of
Price per Unit
Variable Cost per
Турe 1
$5
$10
Туре 2
$7.50
$13
Туре 3
$9
$15
Unit
Unit Sold
2000
1500
1300
a. Calculate the separate contribution margin ratio for each product
b. Calculate the weighted-average contribution margin ratio of the company as a
whole.
c. If the company's fixed costs are $100, 000 per annum, calculate the breakeven
distribution of products.
Transcribed Image Text:7. cereal. Following table shows the sales price, variable cost per unit and units sold of each product: WonderFood is a multi-product company that makes three types of Price per Unit Variable Cost per Турe 1 $5 $10 Туре 2 $7.50 $13 Туре 3 $9 $15 Unit Unit Sold 2000 1500 1300 a. Calculate the separate contribution margin ratio for each product b. Calculate the weighted-average contribution margin ratio of the company as a whole. c. If the company's fixed costs are $100, 000 per annum, calculate the breakeven distribution of products.
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