Answer:
1. $858,000
2. Chicken = 24,000 units and Fish = 36,000 units
Explanation:
The computation is shown below:
1. The anticipated level of profits for the expected sales volumes is
= Expected sales of chicken × (Selling price per taco - Variable cost per taco) + Expected sales of fish × (Selling price per taco - Variable cost per taco) - total fixed cost
= 200,000 × ($3 - $1.50) + 300,000 × ($4.50 - $2.25) - $117,000
= $300,000 + $675,000 - $117,000
= $858,000
2. The break even volume is
Let we assume the sale units be X
So, total units sold for chicken = 40X
And, for the fish it is = 60X
Sale units of chicken × (Selling price per taco - Variable cost per taco) + Sale units of chicken × (Selling price per taco - Variable cost per taco) = Total Fixed cost
0.40X × (3 – 1.50) + 0.60X × (4.50 – 2.25) = $117,000
0.60X + 1.35X = $117,000
1.95X = $117,000
So, the X is 60,000 units
So for chicken it is 60,000 × 40% = 24,000 units
And for fish it is 60,000 × 60% = 36,000 units
