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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
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 | $ | 100,000 | $ | 50,000 | $ | 150,000 | |||
Variable expenses | 31,000 | 6,500 | 37,500 | ||||||
Contribution margin | $ | 69,000 | $ | 43,500 | 112,500 | ||||
Fixed expenses | 83,250 | ||||||||
Net operating income | $ | 29,250 | |||||||
Required: (SHOW ALL WORK)
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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