(a)
Break-Even Point:
Break-Even point is the point of sales at which entity neither earns a profit nor suffers a loss. It can also be said that the point of sales at which sales value of the entity recovers the entire cost of fixed and variable nature is called break-even point.
To Determine: The break-even point in units for the company.
(b)
Break-Even Point:
Break-Even point is the point of sales at which entity neither earns a profit nor suffers a loss. It can also be said that the point of sales at which sales value of the entity recovers the entire cost of fixed and variable nature is called break-even point.
To Determine: The number of units of each product line that the company must sell to break even.
(c)
Sales Mix:
Sales mix refers to the relative distribution of the total sales among the number of products sold by a company. In other words, it is expressed as a percentage of units sold for each product with respect to the total units sold for all the products.:
To Verify: That the mix of sales units determined in part (b) will generate a zero net income.
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Managerial Accounting: Tools for Business Decision Making
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