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Business, 20.06.2020 22:57 iixyloa

Patriot Co. manufactures and sells three products: red, white, and blue. Their unit selling prices are red, $48; white, $78; and blue, $103. The per unit variable costs to manufacture and sell these products are red, $33; white, $53; and blue, $73. Their sales mix is reflected in a ratio of 4:5:2 (red:white:blue). Annual fixed costs shared by all three products are $143,000. One type of raw material has been used to manufacture all three products. The company has developed a new material of equal quality for less cost. The new material would reduce variable costs per unit as follows: red, by $8; white, by $18; and blue, by $8. However, the new material requires new equipment, which will increase annual fixed costs by $13,000. Required: 1. Assume if the company continues to use the old material, determine its break-even point in both sales units and sales dollars of each individual product. (Round composite units up to next whole number.)

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