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What is the correct answer? 100% Sparrow Company sells three different products that are similar, but are differentiated by various product features. Budgeted sales by
What is the correct answer?
100% Sparrow 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 48% 20% 32% Sales $240,000 $100,000 $160,000 $500,000 Less: variable costs 72,000 80,000 88,000 240,000 Contribution margin $168,000 $ 20,000 $ 72,000 $260,000 Less: fixed expenses $233,600 Net operating income $ 26,400 If the actual percentage of sales for the year were Standard, 40%; Deluxe, 50%; and Premium, 10%, than Select one: O A. the overall contribution margin would increase and break-even sales would increase. o O o B. the overall contribution margin would increase and break-even sales would decrease. C. the overall contribution margin would decrease and break-even sales would increase. D. the overall contribution margin would decrease and break-even sales would decreaseStep by Step Solution
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