QUESTION 26 Diana Company makes and sells 2 models of dishwashers, Model ABC and Model XYZ. For every 2 Model ABC sold, 3 Model XYZ are sold. Larry Company incurs $1,120,000 in fixed costs per month. The contribution margin per unit of Model ABC is $200 and the contribution margin per unit of Model XYZ is $400. How many units of Model XYZ would the company need to sell at its breakeven point? 2,240 units 3,500 units 3,733 units 2,100 units QUESTION 27 Westfall Watches has two product lines: Luxury watches and Sporty watches. Income statement data for the most recent year follow Total Luxury Sporty Sales revenue $490,000 $360,000 $130,000 Variable expenses 359.000 235.000 124.000 Contribution margin 131000 125,000 6000 Fixed expenses 76.000 38.000 38.000 Operating income (loss) $55.000 $87.000 $32.000 Assuming fixed costs remain unchanged, how would discontinuing the Sporty line affect operating income? Increase in total operating income of $130,000 Increase in total operating income of $49,000 Decrease in total operating income of $131,000 Decrease in total operating income of $6,000