# Calculations for Sales Mix, Contribution Margin and Weighted Average Contribution

Question

Bennis Shafts produces three types of golf club shafts which it sells to golf club manufacturers.  Prepare ONE worksheet to answer the following questions and to determine the outcomes of the different scenarios below.

Section A.

Answer the following questions based on the information as given:
1)  What is the sales mix?
2)  What is the contribution margin per unit for each type of shaft?
3)  What is the weighted average unit contribution margin for this mix of shafts (show both the CMU method and the total CM method)
4)  How many of each type of shaft must Bennis sell to breakeven?
5)  Given the limited production time, which type of shaft is most profitable?

Section B.

1. Prepare a variable costing income statement for each scenario below.  The assumptions/changes for each scenario should be shown in the input section and clearly labeled for that scenario.  The changes in scenarios 2, 3 and 4 are based on scenario 1 which is the information as given.  This means that all items should be at the values used in scenario 1 except the item(s) that are indicated to change for that particular scenario.  Prepare and clearly label a separate income statement for each scenario.

2. Prepare a Word document with a short memo (1/2 page single spaced) to Bennis Shafts management explaining the effects of scenarios 2, 3 and 4 on their operating income compared to scenario 1.  Please be clear but concise.
Scenario 1 – Bennis sells shafts in the quantities, prices and costs as indicated in the given information.
Scenario 2 – Due to a decrease in orders by 10%, management attempts to compensate for lower sales by increasing all prices by 10%.
Scenario 3 – Bennis hires a new production supervisor at \$50,000 in response to an increase in orders of 10%.
Scenario 4 – Bennis changes its sales mix to Steel – 20%, Titanium – 60% and Beryllium – 20% while producing the same total number of golf club shafts.

Steel    Titanium    Beryllium    Total
Number of sets                               6000       2000         1000
Price per set                                \$120.00     \$150.00     \$192.00
Direct material per set                   \$18.00        \$33.00     \$42.00
Direct labor per set                         \$12.00     \$12.00     \$12.00
Time to produce each shaft                  0.5         0.4         0.7
Fixed costs                                                                              \$300,000

Summary

The question is about the calculation of sales mix, contribution margin per unit, weighted average unit contribution, breakeven point, number of units produced for a given time, etc for a golf club manufacturer. The solution contains all the calculations.

Total Word Count 102

• Rasha

this is a very good website

• maani

I have 50 questions for the same test your page is showing only 28

• joeanne

• joeanne

hi can anyone help or guide me to my assignments. thanks

• Monik

• Cristina

This solution is perfect ...thanks

• Janete

Hello Allison,I love the 2nd image that you did! I also, had never heard of SumoPaint, is something that I will have to exolpre a bit! I understand completely the 52 (or so) youtube videos that you probably watched. Sometimes they have what you want, sometimes they don't! However, it is always satisfying when you are able to produce something that you have taught yourself. Great job!Debra 0 likes

• Sandeep

Perfect bank of solution.

• Oxana

great !

• Paul Brandon-Fritzius

thanks for the quick response. the solution looks good. :)

• tina Johnson

thnx for the answer. it was perfect. just the way i wanted it.

• Giuseppe

works fine.