Selling price per bag$60$90

Variable cost per bag$30$30

Expected sales (bags) per year8,00012,000

The total fixed costs per year for the company are $678,000.

Required:

a.What is the anticipated level of profits for the expected sales volumes?

b.Assuming that the product mix is the same at the break-even point, compute the break-even point.

c.If the product sales mix were to change to nine Programmer-style bags for each Executive-style bag, what would be the new break-even volume for On-the-Go?