A Company Sells Three Products as Shown Below These Three Products All Always Sold in Fixed Proportions

question 7

Essay

A company sells three products as shown below: $$\begin{array} { | l | r | r | r | r | } \hline & \text { Product X} & \text { Product Y} & \text { Product Z} & \text { Total } \\\hline \text { Units } & 60,000 & 140,000 & 50,000 & 250,000 \\\hline \text { Sales } & \$ 90,000 & \$ 150,000 & \$ 60,000 & \$ 300,000 \\\hline \text { Variable Costs } & \$ 63,000 & \$ 93,000 & \$ 19,000 & \$ 175,000 \\\hline \begin{array} { l } \text { Contribution } \\\text { Margin }\end{array} & & & & \$ 125,000 \\\hline \text { Fixed Costs } & & & &\$100,000 \\\hline\end{array}$$ These three products all always sold in fixed proportions. In other words, Product X always accounts for 24% of total sales (60,000/250,000), Product Y always accounts for 56% of total sales (140,000/250,000), and Product Z always accounts for 20% of total sales (50,000/250,000).
Required:
a. How many units of each product need to be sold to break-even?
b. How many units must of each product must be sold if the company wants to have a profit of $50,000?

Recognize the role of governments in promoting free trade and managing exchange rates.

Define and exemplify financial terms related to exchange rates and international finance.

Analyze the effects of currency fluctuations on international financial transactions.

Evaluate the role of trade theories in shaping international trade policies.

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Definitions:

Constant Values

Fixed values in mathematics or computing that do not change.

Paste Button

A user interface element that allows users to insert text, data, or multimedia content previously copied or cut from another location.

Nonadjacent Location

Refers to cells or areas in a spreadsheet that are not next to each other but are selected or manipulated as a group.

Fill Formatting Only

An option in software applications that applies formatting attributes like color, pattern, or style to selected elements without modifying the content.