Question
Olongapo Sports Corporation distributes two premium golf ballsthe Flight Dynamic and the Sure Shot. Monthly sales and the contribution margin ratios for the two products
Olongapo Sports Corporation distributes two premium golf ballsthe Flight Dynamic and the Sure Shot. Monthly sales and the contribution margin ratios for the two products follow: |
Product | |||
Flight Dynamic | Sure Shot | Total | |
Sales | $680,000 | $320,000 | $1,000,000 |
CM ratio | 67% | 72% | ? |
Fixed expenses total $588,500 per month. |
Required: | |
1. | Prepare a contribution format income statement for the company as a whole. Round your percentage answers to 2 decimal places (i.e. .1234 is considered as 12.34). |
2. | Compute the break-even point for the company based on the current sales mix. (Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.) |
3. | If sales increase by $57,000 a month, by how much would you expect net operating income to increase? (Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.) |
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