You examine the financial statements of a firm and find that for every unit of Product X sold, the firm sells 4 units of Product Y. For example, if the firm sold 100 units of X, it would see 400 of Y. The sales price and variable cost per unit for Product X are $100 and $70, respectively; the sales price and variable cost per unit for Product Y are $80 and $60, respectively.
a. 1.Assuming a constant product mix and fixed costs of $550,000, how many of each product line must be sold to break even?
b. 2.What is total sales revenue (in dollars) at the break-even point? Show your work.