Question
A firm is selling two products, chairs and bar stools, each at $50 per unit. Chairs have a variable cost of $30, and bar stools
A firm is selling two products, chairs and bar stools, each at $50 per unit. Chairs have a variable cost of $30, and bar stools $20. Fixed cost for the firm is $20,000. a. If the sales mix is 1:1 (one chair sold for every bar stool sold), what is the break-even point in dollars of sales? In units of chairs and bar stools? (Round up your unit answers to the next whole number and round "Break-even point" to the nearest whole number.) Break-even point $ Number of chairs Number of bar stools b. If the sales mix changes to 1:4 (one chair sold for every four bar stools sold), what is the break-even point in dollars of sales? In units of chairs and bar stools? (Round up your unit answers to the next whole number and round "Break-even point" to the nearest whole number.) Break-even point $ Number of chairs Number of bar stools
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