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Exercise 5-10 Multiproduct Break-Even Analysis [LO5-9] Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for
Exercise 5-10 Multiproduct Break-Even Analysis [LO5-9] Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below:
Claimjumper | Makeover | Total | ||
Sales | $30,000 | $70,000 | $100,000 | |
Variable Expenses | $20,000 | $50,000 | $70,000 | |
Contribution Margin | $10,000 | $20,000 | $30,000 | |
Fixed Expenses | $24,000 | |||
Net Operating Income | $6,000 |
1. What is the overall contribution margin (CM) ratio for the company?
2. What is the company's overall break-even point in dollar sales?
3. Prepare a contribution format income statement at the company's break-even point that shows the appropriate levels of sales for the two products.
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