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ABC produces and sells two products, the Simple and the Complex. The Simple sells for $16 per unit and the Complex for $28 per unit. The total variable cost for a Simple unit is $10 and Complex’s variable cost per unit is $20. For every six units of Simple sold, two unit of Complex is sold. This sales mix is expected to remain the same for the foreseeable future. Fixed costs total $182,000.
The break-even point in terms of revenue is:
A. $266,000
B. $488,000
C. $532,000
D. $688,000
The answer is B. |
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