Problem 21-7A Break-even analysis with composite units P4 e Patriot Co. manufactures and sells three products: red, white, and blue. Their unit selling prices are red, $20; white, S35; and blue, $65. The per unit variable costs to manufacture and sell these products are red, $12; white, $22; and blue, $50. Their sales mix is reflected in a ratio of 5:4:2 (red:white:blue). Annual fixed costs shared by all three products are $250,000. One type of raw material has been used to manufacture all three products. The company has developed a new material of equal quality for less cost. The new material would reduce variable costs per unit as follows: red, by $6; white, by $12; and blue, by S10. However, the new material requires new equipment, which will increase annual fixed costs by $50,000. (Round answers to whole composite units.) Required Page 930 1. If the company continues to use the old material, determine its break-even point in both sales units and sales dollars of each individual product. Check (1) Old plan break-even, 2,050 composite units frounded) 2. If the company uses the new material, determine its new break-even point in both sales units and sales dollars of each individual product. (2) New plan break-even, 1,364 composite units (rounded) Analysis Component 3. What insight does this analysis offer management for long-term planning