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A company manufactures two products. Information about the two product lines for the current year is as follows:

Product A Product B
Selling price per unit $90 $120
Variable costs per unit $50 $60
The company expects fixed costs to be $70,000. Calculate the break-even quantity of each product when the sales mix is 2:1.

User Teson
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Final answer:

The question involves calculating the break-even quantity for two products considering a fixed sales mix and given fixed and variable costs. The subject matter concerns break-even analysis in a business context, appropriate for college-level study.

Step-by-step explanation:

The subject of this question revolves around the concept of break-even analysis in a business setting, particularly within the context of a company selling two different products and needing to determine the quantity of each product it must sell at a given sales mix to cover its fixed costs. By applying the formula for break-even analysis, considering the fixed costs and the sales mix ratio, the student can calculate the number of units of Product A and Product B the company needs to sell to break even. As this requires financial computations and understanding the relationship between costs, revenues, and profit, it falls under the domain of business studies and requires a college-level understanding of basic accounting and finance principles.

User Ezenhis
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