1. Eastwick produces and sells three products. Last month's results are as follows:

	P1			P2			P3
Revenues	$	100,000		$	200,000		$	200,000
Variable costs		40,000			140,000			80,000

Fixed costs total $200,000. What is Eastwick's break-even sales volume? (Assume the current product mix.)

a.$384,615.

b. $500,000.

c. $460,000.

d. $416,667.

2. Evergreen Corporation manufactures circuit boards and is in the process of preparing next year's budget. The pro forma income statement for the current year is presented below.

Sales				$	3,500,000
Cost of sales:
Direct Material	$	500,000
Direct labor		250,000
Variable Overhead		275,000
Fixed Overhead		600,000			1,625,000
Gross Profit				$	1,875,000
Selling and General & Admin. Exp.
Variable		750,000
Fixed		250,000			1,000,000
Operating Income				$	875,000

For the coming year, the management of Evergreen Corporation anticipates a 5 percent decrease in sales, a 10 percent increase in variable costs, and a $45,000 increase in fixed costs. The break-even point for next year would be:

a. $2,168,225.

b. $2,668,750.

c. $2,947,500.

d. $3,022,500.