BJS Ltd produces and sells the following three products Product Selling price per unit VC per unit Contribution per unit Budgeted sales volume X $16 $5 $11 50 000 units Y $20 $15 $5 10 000 units Z $10 $7 $3 100 000 units The company expects the fixed costs to be $450,000 for the coming year. Assume that sales arise throughout the year in a constant mix Required (a) Calculate the weighted average C/S ratio for the products. (b) Calculate the breakeven sales revenue required. (c) Calculate the amount of sales revenue required to generate a profit of $600,000. (d) Draw a multi-product profit-volume chart assuming the budget is achieved.
BJS Ltd produces and sells the following three products Product Selling price per unit VC per unit Contribution per unit Budgeted sales volume X $16 $5 $11 50 000 units Y $20 $15 $5 10 000 units Z $10 $7 $3 100 000 units The company expects the fixed costs to be $450,000 for the coming year. Assume that sales arise throughout the year in a constant mix Required (a) Calculate the weighted average C/S ratio for the products. (b) Calculate the breakeven sales revenue required. (c) Calculate the amount of sales revenue required to generate a profit of $600,000. (d) Draw a multi-product profit-volume chart assuming the budget is achieved.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:BJS Ltd produces and sells the following three products
Product
Selling price per unit
VC per unit
Contribution per unit
Budgeted sales volume
X
$16
$5
$11
50 000 units
Y
$20
$15
$5
10 000 units
Z
$10
$7
$3
100 000 units
The company expects the fixed costs to be $450,000 for the coming year. Assume
that sales arise throughout the year in a constant mix
Required
(a) Calculate the weighted average C/S ratio for the products.
(b) Calculate the breakeven sales revenue required.
(c) Calculate the amount of sales revenue required to generate a profit of $600,000.
(d) Draw a multi-product profit-volume chart assuming the budget is achieved.
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VIEWStep 2: Answer (A) :Calculation the weighted average contribution sales ratio (C/S ratio) of the products-
VIEWStep 3: Answer (B) :Calculation of break-even sales revenue required
VIEWStep 4: Answer (C) :Calculation of amount of sales revenue required to generate a profit of $600000 :
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