Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

CVP Analysis of Multiple Products Alo Company produces commercial printers. One is the regular model, a basic model that is designed to copy and print

CVP Analysis of Multiple Products Alo Company produces commercial printers. One is the regular model, a basic model that is designed to copy and print in black and white. Another model, the deluxe model, is a color printer-scanner-copier. For the coming year, Alo expects to sell 100,000 regular models and 20,000 deluxe models. A segmented income statement for the two products is as follows: Regular Model Deluxe Model Total Sales $15,000,000 $13,400,000 $28,400,000 Less: Variable costs 9,000,000 8,040,000 17,040,000 Contribution margin $6,000,000 $5,360,000 $11,360,000 Less: Direct fixed costs 1,200,000 960,000 2,160,000 Segment margin $4,800,000 $4,400,000 $9,200,000 Less: Common fixed costs 1,588,800 Operating income $7,611,200 Required: 1. Compute the number of regular models and deluxe models that must be sold to break even. Round your answers to the nearest whole unit. Regular models fill in the blank 1 units Deluxe models fill in the blank 2 units 2. Using information only from the total column of the income statement, compute the sales revenue that must be generated for the company to break even. Round the contribution margin ratio to four decimal places. Use the rounded value in the subsequent computation. (Express as a decimal-based amount rather than a whole percentage.) Round the amount of revenue to the nearest dollar. Contribution margin ratio fill in the blank 3 Revenue $fill in the blank 4

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting For Decision Making And Control

Authors: Jerold Zimmerman

5th Edition

0072975865, 978-0072975864

More Books

Students also viewed these Accounting questions