Answer:
Plain = 450 per month
Flavored = 1800 per month
Explanation:
We will calculate the breakeven in composite units first and then separate the into both products to find out individual number of both products that needs to be sold to break even.
The breakeven in units = Fixed cost / composite contribution margin
The composite contribution margin per unit = Contribution of Product 1 * weight of product 1 + Contribution of product 2 * weight of product 2
Thus, the composite contribution margin (CM) per unit for Popped is,
CM per unit-composite units = (2-0.8) * 1/5 + (4-2.5) * 4/5 = $1.44 per unit
The breakeven in units = 3240 / 1.44 = 2250 units per month
Out of this,
Plain = 2250 * 1/5 = 450 unts
Flavored = 2250 * 4/5 = 1800
