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Verdich [7]
2 years ago
9

Question 7 Suppose that Jaxon Corporation has three products: Red, Black, and White. Red has the highest contribution margin per

unit, Black has the second highest contribution margin per unit, and White has the lowest contribution margin per unit. Suppose that the composite break-even point (i.e., using the weighted-average contribution margin) was computed relying on the relative sales mix of 40% Red, 35% Black, and 25% White. If the sales mix were to change to 35% Red, 35% Black, and 30% White, what would happen to the composite break-even point
Business
1 answer:
kirza4 [7]2 years ago
7 0

The information given show that the thing that will happen to the composite break-even point is that there'll be an increase in dollar sales to break even.

<h3>What is break even point?</h3>

It should be noted that a break even point simply means the point where the total revenue and the total cost are equal.

In this case, a shift in sales mix from high contribution margin to a low one has an effect. This raises the dollar sales required.

Learn more about break even on:

brainly.com/question/21137380

#SPJ1

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To calculate the the worst case scenario for price, lets use the $3.00 per unit estimated by the Company, and apply the same concept, however, taking into account that sales price has a 5 percent plus-or minus range. So we caclulate %95 of $3.00, and this gives us $2.85 as our worst case scenario for price.

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The correct answer is option ( A )

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Hope it helps

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