Kuhner Corporation produces and sells two products. Data concerning those products for the most recent month appear below: Fixed expenses for the entire company were $33,100.
-If the sales mix were to shift toward Product B64P with total dollar sales remaining constant,the overall break-even point for the entire company:

Question

Quizplus · Accepted Answer

If the sales mix shifts towards Product B64P, which has a higher contribution margin, the overall break-even point for the company will decrease. This is because the contribution margin ratio of Product B64P is higher than the contribution margin ratio of other products, and therefore more revenue from this product can contribute towards covering fixed costs. As a result, the company will be able to achieve its break-even point with less total sales volume.

Kuhner Corporation Produces and Sells Two Products