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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 | $ 104,000 | $ 52,000 | $ 156,000 |
Variable expenses | 32,200 | 6,800 | 39,000 |
Contribution margin | $ 71,800 | $ 45,200 | 117,000 |
Fixed expenses | 87,075 | ||
Net operating income | $ 29,925 |
Required:
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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