This is the total breakeven number of units, including both Product C and Product F.
This would be the breakeven point for Product C if it were the only product being sold by Ace Manufacturing. However, more than one product is being sold. Since the contribution margin from Product C is not the only source of contribution margin available to cover fixed costs, its breakeven point is different.
The unit contribution margin for Product C is $2, and Product C represents 80% of the total sales in units (20,000 ÷ 25,000). The unit contribution margin for Product F is $5, and Product F represents 20% of the total sales in units (5,000 ÷ 25,000). Therefore, the weighted average unit contribution margin is ($2 × .80) + ($5 × .20) = $2.60. The breakeven point for sales in total units is calculated as Fixed Costs divided by Unit Contribution Margin. Fixed Costs are $30,000, so the breakeven total number of units is $30,000 ÷ $2.60, or 11,538 units. Since Product C represents 80% of the total number of units sold, the breakeven number of units for Product C is 11,528 × .80, or 9,230.4 units. Since we cannot produce .4 of a unit, we round it up to 9,231 units.
This is the number of units of Product F to be sold at the breakeven point. See correct answer for full calculation.
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Total projected fixed costs for the company are $30,000. Assume that the product mix would be the same at the breakeven point as at the expected level of sales of both products. What is the projected number of units (rounded) of Product C to be sold at the breakeven point?