Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Okabee Enterprises is the distributor for two products, Model A100 and Model B900. Monthly sales and the contribution margin ratios for the two products follow:

Okabee Enterprises is the distributor for two products, Model A100 and Model B900. Monthly sales and the contribution margin ratios for the two products follow:

Product

Model A100 Model B900 Total
Sales $690,000 $310,000 $1,000,000
Contribution margin ratio 63% 77% ?

The companys fixed expenses total $583,000 per month.

Required:
1.

Prepare a contribution format income statement for the company as a whole. (Round your percentage answers to 2 decimal places. Input all amounts as positive values except losses which should be indicated by minus sign. Omit the "$" and "%" signs in your response.)

Model A100

Model B900

Total Company

Amount % Amount % Amount %
(Click to select)Net operating income (loss)Variable expensesContribution marginFixed expensesSales $ $ $
(Click to select)Fixed expensesSalesContribution marginNet operating income (loss)Variable expenses
(Click to select)SalesFixed expensesContribution marginNet operating income (loss)Variable expenses $ $
(Click to select)Net operating income (loss)Contribution marginFixed expensesSalesVariable expenses
(Click to select)Fixed expensesVariable expensesSalesNet operating income (loss)Contribution margin $

2.

Compute the break-even point in sales for the company based on the current sales mix. (Do not round intermediate calculations. Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)

Break-even point in sales $

3.

If sales increase by $40,000 per month, by how much would you expect net operating income to increase? (Do not round intermediate calculations. Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)

Net operating income increases by $

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

2. What are the prospects for these occupations?

Answered: 1 week ago