Mount Carmel Company sells only two products, Product A and Product B.

	Product A	Product B	Total
Selling price	$40	$50
Variable cost per unit	24	40
Total fixed costs			$840,000

Mount Carmel sells two units of Product A for each unit it sells of Product B. Mount Carmel faces a tax rate of 30%.

Required:

1. What is the breakeven point in units for each product assuming the sales mix is 2 units of Product A for each unit of Product B?
2. How many units of each product would be sold if Mount Carmel desires an after-tax net income of $73,500, facing a tax rate of 30%?
3. Calculate margin of safety percentage and degree of operating leverage if 60,000 units of A and 30,000 units of B have been sold.