Exercise 5-10 compute the break-even point for a, Ask an Expert

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Exercise 5-10 Compute the Break-Even Point for a Multiproduct Company [LO9]

Lucky Products markets two computer games: Predator and Runway. A contribution format income statement for a recent month for the two games appears below:

		Predator		Runway		Total
Sales	$	98,000	$	49,000	$	147,000
Variable expenses		24,520		4,880		29,400

Contribution margin	$	73,480	$	44,120		117,600
Fixed expenses						90,480

Net operating income					$	27,120

Required:
1.	Compute the overall contribution margin (CM) ratio for the company. (Omit the "%" sign in your response.)

Overall CM ratio

2.	Compute the overall break-even point for the company in sales dollars. (Do not round intermediate calculation. Omit the "$" sign in your response.)

Overall break-even point

Complete the contribution format income statement at break-even point for the company showing the appropriate levels of sales for the two products. (Input all amounts as positive values except losses which should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations. Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)

Predator	Runway	Total
$	$	$


$	$


		$

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Category:- Accounting Basics
Reference No.:- M9797351

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