Max Company manufactures and sells three products: Good, Better, and Best. Annual fixed costs are $3,315,000, and data about the three products follow.
A. Determine the weighted-average unit contribution margin.
B. Determine the break-even volume in units for each product.
C. Determine the total number of units that must be sold to obtain a profit for the company of $234,000.
D. Assume that the sales mix for Good, Better, and Best is changed to 50%, 30%, and 20%, respectively. Will the number of units required to break-even increase or decrease? Explain. Hint: Detailed calculations are not needed to obtain the proper solution.
Definitions:
Personal Power
The influence or authority an individual has over others, derived from skills, knowledge, or personal attributes, rather than formal positions.
Reward Power
The power to influence others through the offering of rewards, benefits, or incentives for certain behaviors or achievements.
Legitimate Power
The authority derived from a position or role within an organization, granting the power to make decisions and command obedience.
Networking Power
The influence and advantage gained through forming and maintaining valuable professional relationships or networks.
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