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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Auditing Cases
Authors: Frank A. Buckless, Mark. S. Beasley, Steven M. Glover, Douglas F. Prawitt
1st Edition
978-0130800015
