Ticker Company sells two products. Product A provides a contribution margin of ($3) per unit, and Product
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Ticker Company sells two products. Product A provides a contribution margin of \($3\) per unit, and Product B provides a contribution margin of \($4\) per unit. If Ticker’s sales mix shifts toward Product A, which one of the following statements is correct?
a. The total number of units necessary to break even will decrease.
b. The overall contribution margin ratio will increase.
c. Operating income will decrease if the total number of units sold remains constant.
d. The contribution margin ratios for Products A and B will change.
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Related Book For
Managerial Accounting For Undergraduates
ISBN: 9780357499948
2nd Edition
Authors: James Wallace, Scott Hobson, Theodore Christensen
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