Kit Kitchen sells three types of soups: tomato basil, cheddar dill and loaded potato. The following...

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Accounting

Kit Kitchen sells three types of soups: tomato basil, cheddardill and loaded potato. The following table shows the sales priceand variable cost for each type. The restaurant incurs $200,000 ayear in fixed costs. Assume that the restaurant has a sales mix oftwo tomato basil servings, two cheddar dill servings and one loadedpotato serving.

Type

Sales Price/u

Variable Cost/u

Contribution Margin/u

Tomato basil

$3.00

$1.50

$1.50

Cheddar dill

$4.50

$2.00

$2.50

Loaded potato

$4.50

$2.50

$2.00

How many servings (units) of each type will be sold at thebreakeven point?

What amount of revenue ($) would need to be generated by eachtype of soup for the company to earn $25,000 in operatingincome?

Answer & Explanation Solved by verified expert
3.9 Ratings (608 Votes)
Answer a Sales Mix Tomato Basil Cheddar Dill Loaded Potato Sales Mix 2 2 1 Overall Contribution Margin per unit 25 150 25 250 15 200 Overall Contribution Margin per unit 200 Breakeven Point in units Fixed Expenses Overall Contribution Margin    See Answer
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