Alphabeta Corporation sells three products: J, K, and L. The following information was taken from a recent budget:
Total fixed costs are anticipated to be $2,450,000.
Required:
A. Determine Alphabeta's sales mix.
B. Determine the weighted-average contribution margin.
C. Calculate the number of units of J, K, and L that must be sold to break even.
D. If Alphabeta desires to increase company profitability, should it attempt to increase or decrease the sales of product K relative to those of J and L? Briefly explain.

Question

Alphabeta Corporation sells three products: J, K, and L. The following information was taken from a recent budget:  
Total fixed costs are anticipated to be $2,450,000.
Required: 
A. Determine Alphabeta's sales mix.
B. Determine the weighted-average contribution margin.
C. Calculate the number of units of J, K, and L that must be sold to break even.
D. If Alphabeta desires to increase company profitability, should it attempt to increase or decrease the sales of product K relative to those of J and L? Briefly explain.

Quizplus · Accepted Answer

The Answer of Alphabeta Corporation sells three products: J, K, and L. The following information was taken from a recent budget:  
Total fixed costs are anticipated to be $2,450,000.
Required: 
A. Determine Alphabeta's sales mix.
B. Determine the weighted-average contribution margin.
C. Calculate the number of units of J, K, and L that must be sold to break even.
D. If Alphabeta desires to increase company profitability, should it attempt to increase or decrease the sales of product K relative to those of J and L? Briefly explain.

Alphabeta Corporation Sells Three Products: J, K, and L