Question

Sales Mix and Break-Even Sales Data related to the expected sales of two types of frozen pizzas for Norfolk Frozen Foods Inc. for the current yeat which is type of recent years, we as follow Products Unit Selling Price Unit Variable Cost Sales Mix 12" Plaza 16" Pizza The estimated feed costs for the current year are $46,800 Required: 1. Determine the estimated units of sales of the overall enterprise product, units necessary to reach the break-even point for the current year 2. Based on the braven les unita) in part (1) determine the units of both the 17 and for the current yet 12" pizza 16" pirma 3. Assume that the sales 50% 12" and 30416 Come the break verlere product. Why different in this scenario than in part (1) because th toward the product with the higher The break-even point is product

Answer 1

1
Estimated fixed costs	46800
Divide by Weighted average Contribution margin per unit	10.40	=(12-3)*30%+(15-4)*70%
Overall Break-even point	4500	units
2
12" Pizza	1350	units	=4500*30%
16" Pizza	3150	units	=4500*70%
3
Estimated fixed costs	46800
Divide by Weighted average Contribution margin per unit	10.00	=(12-3)*50%+(15-4)*50%
Overall Break-even point	4680	units
4
The break even point is higher in this scenario than in part(1) because the sales mix is weighted less (alternatively not weighted) toward the product with the higher contribution margin per unit of product