Exercise Express sells exercise equipment.For purposes of a cost-volume-proﬁt analysis, the shop owner has divided sales into two categories of treadmills, as follows: Three-quarters of the shop's sales are medium-quality treadmills.The shop's annual ﬁxed expenses are $65,000.(In the following requirements, ignore income taxes.) Required: 1.Compute the unit contribution margin for each product type. 2.What is the shop's sales mix? 3.Compute the weighted-average unit contribution margin, assuming a constant sales mix. 4.What is the shop's break-even sales volume in dollars? Assume a constant sales mix. 5.How many treadmills of each type must be sold to earn a target net income of $48,750? Assume a constant sales mix.

Question

Exercise Express sells exercise equipment.For purposes of a cost-volume-proﬁt analysis, the shop owner has divided sales into two categories of treadmills, as follows:  Three-quarters of the shop's sales are medium-quality treadmills.The shop's annual ﬁxed expenses are $65,000.(In the following requirements, ignore income taxes.) Required: 1.Compute the unit contribution margin for each product type. 2.What is the shop's sales mix? 3.Compute the weighted-average unit contribution margin, assuming a constant sales mix. 4.What is the shop's break-even sales volume in dollars? Assume a constant sales mix. 5.How many treadmills of each type must be sold to earn a target net income of $48,750? Assume a constant sales mix.

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The Answer of Exercise Express sells exercise equipment.For purposes of a cost-volume-proﬁt analysis, the shop owner has divided sales into two categories of treadmills, as follows:  Three-quarters of the shop's sales are medium-quality treadmills.The shop's annual ﬁxed expenses are $65,000.(In the following requirements, ignore income taxes.) Required: 1.Compute the unit contribution margin for each product type. 2.What is the shop's sales mix? 3.Compute the weighted-average unit contribution margin, assuming a constant sales mix. 4.What is the shop's break-even sales volume in dollars? Assume a constant sales mix. 5.How many treadmills of each type must be sold to earn a target net income of $48,750? Assume a constant sales mix.

Exercise Express Sells Exercise Equipment