Question
Henna Company produces and sells two products, Carvings, and Mementos. It manufactures these products in separate factories and markets them through different channels. They have
Henna Company produces and sells two products, Carvings, and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 50,000 units of each product. Income statements for each product follow.
| Carvings | Mementos | |
|---|---|---|
| Sales | $ 2,000,000 | $ 2,000,000 |
| Variable costs | 1,600,000 | 250,000 |
| Contribution margin | 400,000 | 1,750,000 |
| Fixed costs | 125,000 | 1,475,000 |
| Income | $ 275,000 | $ 275,000 |
Required: 1. Compute the break-even point in dollar sales for each product. (Enter CM ratio as percentage rounded to 2 decimal places.)
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
