Jamal Co makes and sells two types of shoes Plain and Fancy

Jamal & Co. makes and sells two types of shoes, Plain and Fancy. Data concerning these products are as follows: Plain Fancy Unit selling price $23.00 $30.00 Variable cost per unit 11.00 25.00 Sixty percent of the unit sales are Plain, and annual fixed expenses are $55,200. The weighted-average unit contribution margin is:

1. The weighted-average unit contribution margin is (Round intermediate calculations and final answer to 2 decimal places):

a. $5.00

b. an amount other than those above.

c. $17.20

d. $9.45.

e. $9.20.

2. Required information Assuming that the sales mix remains constant, the total number of units that Jamal must sell to break even is (Round intermediate calculations to 2 decimal places and final answer to nearest whole number):

a. 3,432

b. 3,647

c. 5,737

d. an amount other than those above

e. 6,000

Solution

1.Weighted Contribution margin=Respective Contribution margin*Respective weights

=(12*0.6)+($5*0.4)(Weight of Fancy=(100-60)=40%)

=$9.20

2.Total units to be sold=Fixed expenses/Weighted Contribution margin

=(55200/9.2)

=6000 units.