Q 415,000.

00
SP 68.00
VC 56.00
FC 1,660,000.00

1 CM 4,980,000.00
OI 3,320,000.00

2 NEW FC 4,980,000.00
VC 40.00

CM 11,620,000.00
OI 6,640,000.00

3 Decrease in OI (3,320,000.00)

DOL Comparison 1.50

1.75
FC 2,000.00 12.00 24,000.00
VC 600.00
SP 2,500.00
VC 400.00
FC 55,000.00
Fixed Income 52,000.00
1
TFC 79,000.00
TVC 1,000.00
CM per concert 1,500.00
Breakeven Concerts 18.00

2
Additional FC 42,000.00
TFC 121,000.00
Breakeven Concerts 46.00

Concerts 33.00
TR 82,500.00
TVC 33,000.00
CM 49,500.00
TFC-FI 69,000.00
OI (19,500.00)

3
Addtl Fixed Income 21,000.00
NEW FIXED INCOME 73,000.00
TFC 121,000.00
Breakeven Concerts 32.00
TVC 13.50
TFC 148,500.00
SP 27.00
Expected Sales 20,500.00
TR 553,500.00
Tax Rate 40%

1
Rev - VC - FC = Target NI / 1 - Tax Rate

TR 553,500.00
TVC 276,750.00
CM 276,750.00
TFC 148,500.00
OI 128,250.00
Tax Rate 40%
Net Income 76,950.00

2
CM per bowl 13.50
BEP 11,000.00

3
TR 594,000.00 NEW Quantity 22,000.00
TVC 297,000.00
CM 297,000.00
TFC 195,750.00 (luma na FC plus yung additional sa given)
OI 101,250.00
Tax Rate 40% 40,500.00
Net Income 60,750.00

4
CM per bowl 13.50

BEP in Revenues 391,500.00

5
TR 27.00
VC 13.50
FC 195,750.00
TNI 76,950.00
1 - Tax 0.60
Q 24,000.00
Req Revenue 648,000.00
6
Q 22,000.00

TR 594,000.00
VC 297,000.00
FC 148,500.00
Advertising 48,500.00
TNI 60,000.00
1 - Tax 0.60

Revenue - VC - (Fixed Cost + Advertising) = Target NI / (1 - Tax)

 Standard Deluxe Total
Units Sold 176,000.00 44,000.00 220,000.00
Price 20.00 37.00
Revenues 3,520,000.00 1,628,000.00 5,148,000.00
VC 15.00 17.00
TVC 2,640,000.00 748,000.00 3,388,000.00
CM 880,000.00 880,000.00 1,760,000.00
FC 1,300,000.00
OI 460,000.00

1
Percentage 80% 20%
Sales Mix 4.00 1.00 5.00

for every 1 deluxe unit sold, 1.00 unit sold 4.00 standard units are sold

Ratio CM per unit CM of bundle

Standard 4.00 5.00 20.00
Deluxe 1.00 20.00 20.00
Total 5.00 40.00

FC 1,300,000.00
CM per bundle 40.00
BEP in bundle 32,500.00

Standard Deluxe
BEP in Bundle 32,500.00 32,500.00
Sales Mix 4.00 1.00
BEP In units 130,000.00 32,500.00

2
ONLY STANDARD ONLY DELUXE
FC 1,300,000.00 1,300,000.00
CM per unit 5.00 20.00
BEP in units 260,000.00 65,000.00

3
Standard Sold 198,000.00
Deluxe Sold 22,000.00
TOTAL 220,000.00
Standard Deluxe Total
Units Sold 198,000.00 22,000.00 220,000.00
Revenues 3,960,000.00 814,000.00 4,774,000.00
VC 2,970,000.00 374,000.00 3,344,000.00
CM 990,000.00 440,000.00 1,430,000.00
FC 1,300,000.00
OI 130,000.00

Percentage 90% 10%

Sales Mix 9.00 1.00 10.00

Ratio CM per unit CM of bundle

Standard 9.00 5.00 45.00
Deluxe 1.00 20.00 20.00
Total - 65.00

FC 1,300,000.00
CM per bundle 65.00
BEP in bundle 20,000.00

Standard Deluxe
BEP in Bundle 20,000.00 20,000.00
Sales Mix 9.00 1.00
BEP In units 180,000.00 20,000.00

The major lesson of this problem is that changes in the sales mix change
breakeven points and operating incomes
.
In this example, the budgeted and actual total sales in number of units were identical, but the proportion of the product having t
higher
contribution margin declined. Operating income
suffered
and the breakeven point
rose
.
standard units are sold
 Changes in the sales mix change both
the breakeven points and the operating
income. If the proportion of the product
with the higher contribution margin
declines, the breakeven point will
increase and operating income will
decrease. If the proportion of the
product with the lower contribution
margin declines, the breakeven point
will decrease and the operating income
will increase.

ut the proportion of the product having the