Golf Shoes For Sale

Posted on April 18th, 2011 by admin

golf shoes for sale


golf shoes for sale
Break Even Point and Total Contribution algebra problem for this accounting/business management scenario.?


The Sole Shoe Store currently stocks 3 lines of ladies’ shoes. Here is the data for each line:

Flats:
Selling Price – $12
Variable Cost – $6
Sales Distribution – $20,000

Golf:
Selling Price – $20
Variable Cost – $12
Sales Distribution – $10,000

Dress:
Selling Price – $24
Variable Cost – $6
Sales Distribution – $70,000

———

#1) What is the TOTAL CONTRIBUTION(%) per overall sales dollar?

#2) What is the Break Even Point in dollars?
A: $42,105
B: $46,281
C: $50,450
D: $84,084
E: None of the above

***Please explain your reasoning, not just give answers. Thanks!***
please help. Any aswer will get the best answer, at this point.

Total contribution per overall sales dollar is equal to the Sales prices less the variable costs

1)
Flats: (12-6)/12
Golf: (20-12)/20
Dress: (24-6)/24
The sales mix is 20/10/70.
So: [20%*(5/12) + 10%(8/20) + 70%(18/24)] = 64.833%

2) Break even is when the contribution equals the fixed costs. We don’t know what the fixed costs are, so I can’t answer this question.


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