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Author Question: Stella Company sells only two products, Product A and Product B. Product AProduct BTotalSelling ... (Read 258 times)

jeatrice

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on: Mar 6, 2021

Question 1

In multiproduct situations, when sales mix shifts toward the product with the lowest contribution margin then ________.
◦ total revenues will increase
◦ interest cost will decrease
◦ total contribution margin will increase
◦ operating income will decrease

Question 2

Stella Company sells only two products, Product A and Product B.

​Product AProduct BTotal
 Selling price$50$30​
Variable cost per unit$20$10​
Total fixed costs ​​$2,110,000
Stella sells two units of Product A for each unit it sells of Product B. Stella faces a tax rate of 40%. Stella desires a net after-tax income of $54,000. The breakeven point in units would be ________.
◦ 25,250 units of Product A and 50,500 units of Product B
◦ 27,500 units of Product A and 55,000 units of product B
◦ 50,500 units of Product A and 25,250 units of Product B
◦ 55,000 units of Product A and 27,500 units of Product B
Horngren's Cost Accounting: A Managerial Emphasis ¦ Datar, Rajan ¦ 16th Edition
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Marked as best answer by jeatrice on Mar 6, 2021

asdfasdf

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Reply #1 on: Mar 6, 2021
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jeatrice

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Reply 2 on: Mar 6, 2021
Great answer, keep it coming :)

jamesnevil303

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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