1. Kalamazoo Company sells three products. Sales and contribution margin ratios for the three products follow:

	Product A				Product B				Product C
Sales in dollars	$	26,000			$	46,000			$	106,000
Contribution margin ratio		20	%			22	%			24	%

Given these data, the contribution margin ratio for the company as a whole would be:

Multiple Choice

• Cannot determine with the information given.

• 31.3%.

• 23%.

• 81%.

2. At a break-even point of 450 units, variable costs were $675 and fixed costs were $405. What will the 451^st unit sold contribute to operating profits before income taxes?

Multiple Choice

• $0.90

• $3.30

• $2.40

• $1.50

3. Break-even analysis assumes that:

Multiple Choice

• total costs are constant.

• the average variable cost per unit is constant.

• variable costs are nonlinear.

• the average fixed cost per unit is constant.