Case Sea Brink Sandals Sea Brink Sandals (SBS) produces three types of sandals, the Active, the Beach, and the Coral. SB

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Case
Sea Brink Sandals Sea Brink Sandals (SBS) produces three types
of sandals, the Active, the Beach, and the Coral. SBS sells the
sandals to sportswear and beach stores in the South of France. The
owner of SBS, Georgette, launched SBS after years of frustration
with the poor quality of beach footwear. Georgette is very proud to
do business with local artisans who use sustainable materials.
Since its creation 10 years before, SBS has become a staple
renowned in the South of France, and Georgette is dreaming to
expand the company in other markets. The following
information is for next year's production and sales. SBS plans to
make and sell a total of 53,000 pairs of sandals next year. The
production plan broken down by product is: 20,000 pairs of Active,
18,000 pairs of Beach, and 15,000 pairs of Coral. SBS's accountant
Pierre determined that maximum demand from the French market next
year will be 22,000 Active, 20,000 Beach, and 20,000 Coral. The
selling price per pair of sandals will be $18 for Active, $22 for
Beach, and $24 for Coral. The production process at SBS is a bit
particular. To make any type of pairs of sandals (Active, Beach or
Coral), SBS must first make a pair of Active. It means that the
Active product is used as the underlying product for the two other
products, Beach and Coral. To make a Beach or Coral pair, SBS first
makes a pair of Active and then transforms it into a pair of either
Beach or Coral. The direct material cost per Active pair will be
$7. The direct labour hourly wage will be $28. Direct labour will
be able to make 10 Active pairs per direct labour hour. The
production supervisor dedicated to the production of the Active
sandals will receive a $62,000 yearly salary. To make the Beach and
Coral sandals, SBS adds more direct materials to the underlying
product (the Active product): a pair of Beach will require an
additional $4 in direct materials compared to its underlying
product Active, while the additional direct materials cost for
a pair of Coral will be $1.50. Moreover, the transformation process
of Active into the two other products takes additional labour time
that is paid at the same hourly rate. Once the Active pair will be
made, the Beach pair will need an additional 0.025 direct labour
hours, and the Coral pair will need an additional 0.060 direct
labour hours to be finished. The salary of the supervisors in
charge of the production of the Beach and Coral products will be
$62,000 and $62,000 respectively. The yearly salaries of the
production supervisors will be identical whichever the product in
the current plan, and they are specific to their respective
product. Pierre has also estimated the following corporate fixed
costs for next year. SBS will rent its current building for $6,000
per month. Planned selling and administrative expenses will be
$90,000. Depreciation will be $70,000. Finally, production capacity
is limited by the number of direct labour hours.
The company plans to operate at practical capacity next
year, which the current production plan reflects. SBS operates in
just in time, meaning that they do not keep any inventory of
materials, work-in-process units, or completed units. maro
Question
if the product mix remains constant, what will the
breakeven number of pairs of sandals for each of the three
products
be?