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What would be the affect on the firm net income

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Reference no: EM132962217

Problem 1: Darth Company sells three products. The contribution margin ratios for the three products are 45% for Product X, 40% for Product Y and 15% for Product Z. if the company's sale mix changes and it sells 10,000 less units of product X and 10,000 more units of Product Z, what would be the affect on the firm's net income and break-even point in sales dollars?

A. Net income will decrease and the break-even point in dollars will decrease
B. Net income will decrease and the break-even point in dollars will increase
C. Net income will increase and the break-even point in dollars will decrease
D. Net income will increase and the break-even point in dollars will increase

 

Reference no: EM132962217

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