Question: Electra Corporation manufactures and sells two products: A and B. The operating results of the company are as follows:
Product A Product B
Sales in units 2,000 3,000
Sales price per unit $10 $5
Variable costs per unit 7 3
In addition, the company incurred total fixed costs in the amount of $9,000.
Q1. How many total units would the company have needed to sell to break even?
Q2. If the company would have sold a total of 6,000 units, consistent with CVP assumptions how many of those units would you expect to be Product B?
Q3. How many units would the company have needed to sell to produce a profit of $12,000?