Island Novelties, Incorporated, of Palau makes two productsHawaiian Fantasy and Tahitian Joy. Each product's selling price, variable expense per unit, and annual unit sales are as follows: Hawaiian Fantasy Tahitian Joy Selling price per unit $ 15 $ 100 Variable expense per unit $ 9 $ 20 Number of units sold annually 20,000 5,000 Fixed expenses total $475,800 per year.

Required: Assuming the sales mix given above: Prepare a contribution format income statement showing both dollar and percent columns for each product and for the company as a whole. Compute the company's break-even point in dollar sales. Also, compute its margin of safety in dollars and its margin of safety percentage. The company has developed a new product called Samoan Delight that sell

Island Novelties, Incorporated, of Palau makes two products-Hawaiian Fantasy and Tahitian Joy. Each product's selling price, variable expense per unit, and annual unit sales are as follows: Fixed expenses total $475,800 per year. Required: 1. Assuming the sales mix given above: a. Prepare a contribution format income statement showing both dollar and percent columns for each product and for the company as a whole. b. Compute the company's break-even point in dollar sales. Also, compute its margin of safety in dollars and its margin of safety percentage. 2. The company has developed a new product called Samoan Delight that sells for $45 each and has variable expenses of $36 per unit. If the company can sell 10,000 units of Samoan Delight without incurring any additional fixed expenses: a. Prepare a revised contribution format income statement that includes Samoan Delight. Assume sales of the other two products do not change. b. Compute the company's revised break-even point in dollar sales. Also, compute its revised margin of safety in dollars and margin of safety percentage