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ABC?manufactures and sells car?tyres. It has developed two new models, 'A' and 'Z'.?The annual fixed...

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Accounting

ABC?manufactures and sells car?tyres. It has developed two new models, 'A' and 'Z'.?The annual fixed cost is $180,000. ?From a?pre-launch market survey, it expects that sixty percent of the potential customers prefer 'A' while forty percent prefer ''Z'. The following information has been extracted: 

? A Z 
Selling Price per?tyre $150 $200 
Variable Cost per?tyre $40 $60 
Sales commission per unit $10 $15 


Required:  
(a) Calculate the Unit?contribution margin for each model of the?tyres.???
(b) Calculate the weighted average contribution margin, assuming the sales mix as determined from the survey is expected to remain constant? ?
(c) Calculate the break-even point in units and in sales dollars (in total and per product) for ABC. Assume a constant sales mix.?
(d) How many?tyres?of each?model need to?be sold to earn a target net profit of $380,000? Assume a constant sales mix.?
(e) Identify one key factor that must be assumed to enable CVP analysis to be conducted. 

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