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Break$-$Even Point and Target Profit Measured in Sales Dollars $($Multiple Products$).$ Wool Works, Inc., produces two different products with the following monthly data $($these data are the same as the previous exercise$)$: Break$-$Even Point and Target Profit Measured in Units $($Multiple Products$).$ Wool Works, Inc.,

produces two different products with the following monthly data:

Assume the sales mix remains the same at all levels of sales.

Required:

a$.$ Calculate the weighted average contribution margin per unit.

b$.$ How many units in total must be sold to break even?

c$.$ How many units of each product must be sold to break even?

d$.$ How many units in total must be sold to earn a monthly profit of $$360,000?$

Sweater Jacket Total

Selling price per unit $$100$ $$400$

Variable cost per unit $ $40$ $$240$

Expected unit sales $21,0009,00030,000$

Sales mix $70$ percent $30$ percent $100$ percent

Fixed costs $$2,070,000$

Assume the sales mix remains the same at all levels of sales.

Required:

Round your answers to the nearest hundredth of a percent and nearest dollar where appropriate. $($An example for percentage calculations is $0\mathrm{.}434532=0\mathrm{.}4345=43\mathrm{.}45$ percent; an example for dollar calculations is $$378\mathrm{.}9787=$ $$379.)$

Using the information provided, prepare a contribution margin income statement for the month similar to the one in Table $6\mathrm{.}1.$

Calculate the weighted average contribution margin ratio.

Find the break$-$even point in sales dollars.

What amount of sales dollars is required to earn a monthly profit of $$780,000?$

Assume the contribution margin income statement prepared in requirement a is the company$$s base case. What is the margin of safety in sales dollars?

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