ZTL Corporation produces three products. Cost, price, and volume data is shown below: Total Fixed costs $2,400
Tax rate 40%
Picture Candle CD
Holders Holders Holders
Normal volume 300 150 200
Price per unit $5 $7 $10
Variable cost per unit 2 3 4
When using revenues as the measure, what proportion of the sales mix do CD holders represent? Round to the nearest whole percent.

Question

Quizplus · Accepted Answer

To find the proportion of the sales mix that CD holders represent, calculate the total revenue for each product and then find the percentage of total revenue that comes from CD holders. Total revenue = (300 * $5) + (150 * $7) + (200 * $10) = $1,500 + $1,050 + $2,000 = $4,550. Revenue from CD holders = 200 * $10 = $2,000. Proportion = ($2,000 / $4,550) * 100% ≈ 44%.

ZTL Corporation Produces Three Products