The Chippewa Sports is a sports clothing retail business. The company sells t-shirts and sweatshirts with local sporting teams logos printed on the merchandise. Each t-shirt sells for $20 and the company spends $5 to produce each t-shirt. Each sweatshirt sells for $30 and costs the company $10 in variable costs to produce the product. The company’s sales are made up of 62% of t-shirt sales and 38% of sweatshirt sales. The company’s owners have determined that the business has $43,940 in fixed costs.
a) What is the breakeven point in total units (t-shirts and sweatshirts)? ___________________
b) At the breakeven point, how many t-shirts would the company need to sell (knowing that the product mix will remain the same)? ___________________
c) At the breakeven point, how many sweatshirts would the company need to sell (knowing that the product mix will remain the same)?