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Power Company produces two products. Selling price per unit Variable expenses per unit Contribution margin per unit Product A $40 $28 $12 Product B $16 $12 $4 Assume the fixed expenses are $76,800 per year. The sales mix in units is 30% of A and 70% of B. Required: Determine the units of Products A and B that must be sold to break even.

Power Company produces two products. Selling price per unit Variable expenses per unit Contribution margin per unit Product A $40 $28 $12 Product B $16 $12 $4 Assume the fixed expenses are $76,800 per year. The sales mix in units is 30% of A and 70% of B. Required: Determine the units of Products A and B that must be sold to break even.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Power Company produces two products. Selling price per unit Variable expenses per unit Contribution margin per unit Product A $40 $28 $12 Product B $16 $12 $4 Assume the fixed expenses are $76,800 per year. The sales mix in units is 30% of A and 70% of B. Required: Determine the units of Products A and B that must be sold to break even.
Transcribed Image Text:Power Company produces two products. Selling price per unit Variable expenses per unit Contribution margin per unit Product A $40 $28 $12 Product B $16 $12 $4 Assume the fixed expenses are $76,800 per year. The sales mix in units is 30% of A and 70% of B. Required: Determine the units of Products A and B that must be sold to break even.
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