Information About the Harmonious Company's Two Products Includes If the Sales Mix in Units Is 50 Percent Product

question 108

Multiple Choice

Information about the Harmonious Company's two products includes: $\begin{array}{llr}&\text { Product } X & \text { Product } Y\\\text { Unit selling price } & \$ 11.25 & \$ 11.25 \\\text { Unit variable costs: } \\\text { Manufacturing }& \$ 5.25 & \$ 6.75 \\\text { Selling } & .75& .75 \\\text { Total }&\$6.00 &\$7.50\\\end{array}$
$\begin{array}{lr}\text { Monthly fixed costs are as follows: } & \\\text { Manufacturing } & \$ 82,500 \\\text { Selling and administrative } & 45,000 \\\text { Total } & \$ 127,500\end{array}$
If the sales mix in units is 50 percent Product X and 50 percent Product Y, the monthly break-even total sales dollars is

• A)$75,000.
• B)$318,746.
• C)$275,000.
• D)$315,000.

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Definitions:

Product Cost

The total expense incurred to produce and deliver a product, including direct materials, labor, and overhead.

Period Cost

A type of expense that is not directly tied to the production process and is expensed in the period it is incurred.

Direct Labor

The labor costs directly attributable to the production of goods or services in a company.

Product Cost

The total of costs directly associated with the creation of a product, including raw materials, labor, and manufacturing overheads.