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Mad City Flash sells computers and video game systems. The business is divided into two divisions along product lines. Variable costing income statements for the
Mad City Flash sells computers and video game systems. The business is divided into two divisions along product lines. Variable costing income statements for the current year are presented below: Computers VG Systems Total Sales $800,000 $200,000 $1,000,000 n Variable costs 480,000 140,000 620,000 Contribution margin $320,000 $ 60,000 380,000 Fixed costs 228,000 Net income $ 152,000 Instructions (show calculations): a Determine the sales mix, and contribution margin ratio for each division. 2.5 marks b) Calculate the company's weighted average contribution margin ratio. 2.5 marks c) Calculate the company's break-even point in dollars. 2.5 marks d) Determine the sales level, in dollars, for each division at the break-even point. 2.5 marks
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