At what level of tickets sold will the two plans have the same operating income?

ulti-product breakeven, decision making. Evenkeel Corporation manufactures and sells fine product, an infant car seat called Evenflo at a price of $60 per car seat. Variable costs equal

$24 per car seat. Fixed costs are $594,000. Evenkeel manufactures Evenflo only after it gets firm orders from its customers. In 2007, it sold 30,000 units of Evenflo. One of Evenkeel’s cus¬

tomers, Plaston Corporation, has asked ifin 2008 Evenkeel will manufacture a different style of car seat called Ridex. Plaston will pay $30 for each unit of Ridex. The variable costs for Ridex are estimated to be $18 per seat. Fortunately, Evenkeel has enough capacity to manufacture all the units of Evenflo it can sell and the units of Ridex that Plaston wants and thus will incur no additional fixed costs. Evenkeel estimates it will sell 30,000 units ofEvenflo and 20,000 units of Ridex in 2008.

As Andy Minton, the president of Evenkeel, checked the impact of accepting Plaston’s offer on the breakeven sales revenues for 2008, he was surprised to find that the dollar sales revenues required to break even using the sales mix for 2008 appeared to increase. Fie was not sure that his numbers were correct, but ifthey were, Andy felt inclined to reject Plaston’s offer.

In any event, he thought it best to seek your advice.