The following information is for the jeffries corporation: product a: revenue $ 17.00 variable cost $ 14.00 product b: revenue $ 28.00 variable cost $ 17.00 total fixed costs $ 213,000 what is the breakeven point, assuming the sales mix consists of three units of product a and one unit of product b?

42,600 units

Explanation:

For product A:

Contribution margin = Sales - Variable expenses

                                  = $17 - $14

                                  = $3

For product B:

Contribution margin = Sales - Variable expenses

                                  = $28 - $17

                                  = $11

Assume the current sales makes is one unit of Product A and one unit of Product B.

Current Total Contribution margin = ($3 × 1/2) + ($11 × 1/2)

                                                         = $7

Hence,

Current break-even = Fixed costs ÷ Contribution margin

                                  = $213,000 ÷ 7

                                 = 30,429 units

Now;

Assuming the sales mix consists of three units of Product A and one unit of Product B.

Contribution margin would be = ($3 × 3/4) + ($11 × 1/4)

                                                   = $5/unit

Hence,

Break-even = $213,000 ÷ 5

                   = 42,600 units