Peak Company sells three different products that are similar, but are differentiated by various product features. Budgeted sales by product and in total for the coming year are shown below:

Product

	Standard	Deluxe	Premium	Total
Percentage of total sales	58%	10%	32%	100%
Sales	$120,000	$50,000	$80,000	$250,000
Less: Variable costs	36,000	40,000	44,000	120,000
Contribution margin	$ 84,000	$10,000	$36,000	$130,000
Less: Fixed expenses				$117,000
Net operating income				$ 13,000

If customers are indifferent to which of the products to purchase from Peak Company, which product line should sales personnel recommend to customers that would most improve overall operating income?

	A.	Product line with the highest percentage of total budgeted sales
	B.	Product line with the lowest variable cost
	C.	Product line with the highest contribution margin ratio
	D.	Product line with the highest sales price

Peak Company sells three different products that are similar, but are differentiated by various product features. Budgeted sales by product and in total for the coming year are shown below:

Product

	Standard	Deluxe	Premium	Total
Percentage of total sales	58%	10%	32%	100%
Sales	$120,000	$50,000	$80,000	$250,000
Less: Variable costs	36,000	40,000	44,000	120,000
Contribution margin	$ 84,000	$10,000	$36,000	$130,000
Less: Fixed expenses				$117,000
Net operating income				$ 13,000

If the actual percentage of sales for the year were Standard, 50%; Deluxe, 40%; and Premium, 10%, than

	A.	the overall contribution margin would increase and break-even sales would decrease.
	B.	the overall contribution margin would decrease and break-even sales would increase.
	C.	the overall contribution margin would increase and break-even sales would increase.
	D.	the overall contribution margin would decrease and break-even sales would decrease.