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Question: sales mix and breakeven sales dragon sports inc manufactures and...

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Sales Mix and Break-Even Sales

Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $169,100, and the sales mix is 70% bats and 30% gloves. The unit selling price and the unit variable cost for each product are as follows:

Products Unit Selling Price Unit Variable Cost
Bats $40 $30
Gloves 100 60

a. Compute the break-even sales (units) for both products combined.

b. How many units of each product, baseball bats and baseball gloves, would be sold at break-even point?

Baseball bats units
Baseball gloves units

part 2.

Break-Even Sales and Sales Mix for a Service Company

Zero Turbulence Airline provides air transportation services between Los Angeles, California; and Kona, Hawaii. A single Los Angeles to Kona round-trip flight has the following operating statistics:

Fuel $12,352
Flight crew salaries 9,461
Airplane depreciation 4,467
Variable cost per passenger—business class 55
Variable cost per passenger—economy class 45
Round-trip ticket price—business class 555
Round-trip ticket price—economy class 285

It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight. If required round the answers to nearest whole number.

a. Compute the break-even number of seats sold on a single round-trip flight for the overall product, E. Assume that the overall product is 20% business class and 80% economy class seats.

Total number of seats at break-even seats

b. How many business class and economy class seats would be sold at the break-even point?

Business class seats at break-even seats
Economy class seats at break-even seats
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