MANAGEMENT ACCOUNTING & CONTROL

PROFIT PLANNING AND COST VOLUME PROFIT ANALYSIS

Learning Activity 9. Composite BEP Analysis

R. Dalisay Company has been operating for only a few months. The company sells three
products: R, D & C, each with a unit sales price of Php 50. Budgeted sales by product and in
total for the coming month are shown below:

R D C Total
Percentage of total sales 48% 20% 32%
Sales 240,000 100,000 160,000 500,000
Less: Variable Costs 72,000 80,000 88,000 240,000
Contribution Margin 168,000 20,000 72,000 260,000
Less: Fixed Costs 223,600
Net Income 36,400

1. Average unit contribution margin ratio

Total Ratio
Sales 500,000 100%
Less: Variable Cost 240,000
Contribution Margin 260,000
Average unit contribution margin ratio = Sales/Contribution Margin
= 500,000 / 260,000
Average unit contribution margin ratio = 52 %

2. Composite (or total) breakeven point in units and in pesos

FC/UCM
BEP (units) = 223,600 / 26
BEP (units) = 8,600 Units

FC/CMR
BEP (Php) = 223,600 / 52%
BEP (Php) = 430,000
3. Composite unit contribution margin and sales per mix
Composite Unit Contribution Margin = TSP – TVC
= 50 – 24
Composite Unit Contribution Margin = 26

Sales Per Mix = FC/UCM

= 223,600/26
Sales Per Mix = 8,600

48% 20% 32%

CBEP R D C
4,128 1,720 2,752