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Juli2301 [7.4K]
2 years ago
11

Madison Corporation sells three products (M, N, and O) in the following mix: 3:1:2. Unit price and cost data are: M N OUnit sale

s price$12 $10 $11Unit variable costs 9 8 9Total fixed costs are $585,000. The selling price per composite unit for the current sales mix (rounded to the nearest cent) is:
Business
1 answer:
kolbaska11 [484]2 years ago
6 0

Answer:

Selling price per composite unit= $11.3

Explanation:

Giving the following information:

Madison Corporation sells three products (M, N, and O) in the following mix: 3:1:2.

Unit price and cost data are: M N OUnit sales price$12 $10 $11

<u>First, we need to calculate the sales proportion for each product:</u>

M= 3/6= 0.5

N= 1/6= 0.17

O= 2/6= 0.33

<u>Now, the selling price per composite unit:</u>

Selling price per composite unit= (0.5*12) + (0.17*10) + (0.33*11)

Selling price per composite unit= $11.3

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