ACCT- COST 4210

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Problem 2: Multi-Product CVP Analysis Bob's shop sells three products, Product A, Product B and Product C. Data regarding the three products sold by Bob's Shop are presented below Product Unit Sales Price Unit Invoice Cost Number of Unit Product A Product B Product C $900 $1,500 $1,200 $700 $1,000 $900 Sold 800 500 700 Annual fixed costs are $300,000. Bob's Shop pays a 10 percent sales commission to its sales personnel A. How many units of each product type must Bob's Shop sell in order to break-even? B. How many units of each product type must Bob's Shop sell in order to earn a target after-tax net income of $140,000 assuming that the tax rate is 30%? C. What will happen to Bob's Shop overall breakeven point (number combined units Bob's needs to sell in order to break-even) if sales of Product B increase relative to the sales of Product A? Explain your