Question
Brancati Inc. produces and sells two products. Data concerning those products for the most recent month appear below: Product W07C Product B29Z Sales $25,000 $27,000
Brancati Inc. produces and sells two products. Data concerning those products for the most recent month appear below:
| Product W07C | Product B29Z |
Sales | $25,000 | $27,000 |
Variable expenses... | $7,000 | $8,600 |
Fixed expenses for the entire company for the month were $32,860.
Answer the following questions:
1. Determine the overall break-even point for the company. Show your work!
2. If the sales mix shifts toward Product W07C with no change in total sales, what will happen to the break-even point for the company? Please indicate the direction of the shift, i.e., increase or decrease. Explain, but no calculation is needed.
3. What assumption is usually made concerning sales mix in CVP analysis?
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