Problem: Innovators Inc. produces two products, A and B, with the following characteristics:
Total fixed costs for the company are $21,000.
Q1. What is the anticipated profit given the expected sales volume?
Q2. Assuming the product mix would be the same at the break-even point, compute the break-even point (be sure to indicate the number of units of each product) .
Q3. If only product A was sold, how many units would be needed to break even ?
Q4. If only product B was sold, how many units would be needed to break even ?
Q5. If the product mix changed so that equal units of A and B were sold, what would be the new break-even point in total units?