Chapter 6, Problem 6.10BE

(a)

To determine

Sales Mix:

Sales mix refers to the relative distribution of the total sales among the number of products sold by a company. In other words, it is expressed as a percentage of units sold for each product with respect to the total units sold for all the products.

To Determine: The Company’s sales mix.

(b)

To determine

Contribution Margin ratio: It is a ratio that measures the contribution margin generated by the company from the sales to make it avialable for paying the fixed cost and generate a profit. It is expressed as percentage of margin available from each dollar sales to pay fixed expenses and to provide profit. It is also called as profit-volume ratio. The formula to calculate the contribution margin ratio is as follows:

$\text{Contribution}\text{Margin}\text{Ratio}=\frac{\text{Contribution}\text{Margin}}{\text{Sales}}\times 100$

To Determine: The Company’s weighted-average contribution margin ratio.