Answer:
Break-even point (dollars)= $15,500,000
Explanation:
Giving the following information:
The sales mix is 65% for Sporting Goods and 35% for Sports Gear. Marigold incurs $5735000 in fixed costs.
The contribution margin ratio for Sporting Goods is 30%, while for Sports Gear it is 50%
To calculate the break-even point in dollars, we need to use the following formula:
Break-even point (dollars)= Total fixed costs / Weighted average contribution margin ratio
Break-even point (dollars)= 5,735,000 / (0.3*0.65 + 0.5*0.35)
Break-even point (dollars)= $15,500,000
