The Parsons Company Makes and Sells Two Models of Blenders,as

question 101

Essay

The Parsons Company makes and sells two models of blenders,as follows:
$$\begin{array} { l c r } & \text { Smoothie Pro } & \text { Blend master } \\\text { Sales price per unit } & \$ 50 & \$ 8 0 \\\text { Variable cost per unit } & 25 & 45 \\\text { Contribution margin per unit } & \$ 2 5& \$3 5 \end{array}$$ The Parsons Company expects to incur annual fixed costs of $151,250.The relative sales mix of the products is three units of Smoothie Pro for every one unit of Blendmaster.
Required:
1)Determine the total number of blenders (Smoothie Pro and Blendmaster combined)that Parsons must sell to break even.
2)What is the number of units of Smoothie Pro and of Blendmaster that Parsons would expect to sell at the break-even point?

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Definitions:

CISG

stands for the United Nations Convention on Contracts for the International Sale of Goods, a treaty providing a uniform international sales law.

Specific Exclusions

Provisions in a contract, insurance policy, or law that explicitly remove certain events, actions, or items from coverage or regulation.

Personal Use

Utilization of an item or service purely for an individual's needs or enjoyment, not for business or commercial purposes.

NAFTA

The North American Free Trade Agreement, a treaty between the United States, Canada, and Mexico designed to remove tariff barriers between the three countries.