Exhibit 6-4
Sanchez Company Produces Two Different Remote Control Products

question 78

Multiple Choice

Exhibit 6-4
Sanchez Company produces two different remote control products with the following monthly data for the most recent month:
$\begin{array}{lccc}& \text { Plane } & \text { Boat } & \text { Total } \\\text { Selling price per unit } & \$ 300 & \$ 100 & \\\text { Variable cost per unit } & \$ 240 & \$ 60 & \\\text { Expected unit sales } & 28,000 & 7,000 & 35,000 \\\text { Sales mix } & 80 \% & 20 \% & 100 \% \\\text { Fixed costs } & & & \$ 1,400,000\end{array}$


-Refer to Exhibit 6-4.If the sales mix shifts to 50 percent planes and 50 percent boats,what happens to the break-even point in units?

• A)It increases.
• B)It decreases.
• C)It is not affected.
• D)There is not enough information to answer this question.

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