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(Solved): Lindstrom Company Produces Two Fountain Pen Models. Information About Its Products Follows: Product ...

Lindstrom Company produces two fountain pen models. Information about its products follows:

Product A Product B
Sales revenue $ 125,000 $ 200,000
Less: Variable costs 52,000 50,000
Contribution margin $ 73,000 $ 150,000
Total units sold 5,000 5,000

Lindstrom’s fixed costs total $83,500.

1. Determine Lindstrom’s weighted-average unit contribution margin and weighted-average contribution margin ratio. (Round your weighted-average CM to 2 decimal places and Weighted-Average CM Ratio to 1 decimal place (i.e. .123 should be entered as 12.3%)).

2.Calculate Lindstrom’s break-even point in units and in sales revenue. (Round your intermediate values to one decimal places. Round your "Sales Revenue" answer to 2 decimal places and "Sales Units" answer to the nearest whole number.)

3.Calculate the number of units that Lindstrom must sell to earn a $110,000 profit. (Round your answer to the nearest whole number.)

4.Calculate Lindstrom’s margin of safety and margin of safety as a percentage of sales if it sells 9,000 total pens. (Round your margin of safety in units to the nearest whole number and your percentage of sales answer to 2 decimal places (i.e. .1234 should be entered as 12.34%))

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