Reference: 18_04
a Firm Sells Two Products, a and B

question 82

Multiple Choice

Reference: 18_04
A firm sells two products, A and B. For every unit of A the firm sells, two units of B are sold. The firm's total fixed costs are $1,612,000. Selling prices and cost information for both products follow:
$\begin{array}{rrr}&\text { Unit }&\text { Variables}\\&\text { Sales }&\text { Costs}\\\text { Product}&\text { Price } &\text { per Unit }\\\hline\mathrm{A} & \$ 20 & \$ 8 \\\mathrm{~B} & 24 & 4\end{array}$

-The contribution margin per composite unit is:

• A) $12
• B) $20
• C) $32
• D) $44
• E) $52

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Definitions:

Hail

Frozen precipitation in the form of balls or irregular lumps of ice, often occurring during strong thunderstorms.

Monetary Compensation

Financial payment provided to an individual for services rendered, such as a salary, wages, or benefits.

Breach of Contract

Not meeting any provision of a contract, be it written or spoken, without an acceptable legal justification.

Principle of Mitigation

The legal obligation on a party suffering loss to take reasonable action to minimize the amount of the loss suffered.