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Stella Company Sells Only Two Products,Product a and Product B

Question 193

Multiple Choice

Stella Company sells only two products,Product A and Product B.  Product A  Product B  Total  Selling price $40$50 Variable cost per unit $24$40 Total fixed costs $840,000\begin{array} { | l | c | c | c | } \hline & \text { Product A } & \text { Product B } & \text { Total } \\\hline \text { Selling price } & \$ 40 & \$ 50 & \\\hline \text { Variable cost per unit } & \$ 24 & \$ 40 & \\\hline \text { Total fixed costs } & & & \$ 840,000 \\\hline\end{array} Stella sells two units of Product A for each unit it sells of Product B.Stella faces a tax rate of 30%.Stella desires a net after-tax income of $73,500.The breakeven point in units would be ________.


A) 21,750 units of Product A and 43,500 units of Product B
B) 22,500 units of Product A and 45,000 units of product B
C) 43,500 units of Product A and 21,750 units of Product B
D) 45,000 units of Product A and 22,500 units of Product B

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