A firm is selling two products, chairs and bar stools, each at $ 50 per unit. Chairs have a variable cost of $ 25, and bar stools $ 20. Fixed cost for the firm is $ 20,000.

a. If the sales mix is 1: 1 (one chair sold for every bar stool sold), what is the break- even point in dollars of sales? In units of chairs and bar stools?

b. If the sales mix changes to 1:4 (one chair sold for every four bar stools sold), what is the break- even point in dollars of sales? In units of chairs and bar stools?