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Olongapo Sports Corporation is the distributor in the Philippines of two premium golf ballsthe Flight Dynamic and the Sure Shot. Monthly sales, expressed in pesos
Olongapo Sports Corporation is the distributor in the Philippines of two premium golf ballsthe Flight Dynamic and the Sure Shot. Monthly sales, expressed in pesos (P), and the contribution margin ratios for the two products follow: |
Product | |||
Flight Dynamic | Sure Shot | Total | |
Sales | P 740,000 | P 260,000 | P 1,000,000 |
CM ratio | 67% | 72% | ? |
Fixed expenses total P574,000 per month. |
Requirement 1: |
Prepare a contribution format income statement for the company as a whole. (Round your percentage values to 2 decimal places, e.g., .1234 as 12.34. Input all amounts as positive values. Omit the "P" and "%" signs in your response.) |
Flight Dynamic | Sure Shot | Total Company | ||||
Amount | % | Amount | % | Amount | % | |
Sales | P | P | P | |||
Variable expenses |
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Contribution margin | P |
| P |
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Fixed expenses |
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Net operating income | P | |||||
Requirement 2: |
Compute the break-even point for the company based on the current sales mix. (Round your answer to the nearest dollar amount. Omit the "P" sign in your response.) |
Break-even point | P |
Requirement 3: |
If sales increase by P54,000 a month, by how much would you expect net operating income to increase?(Round your answer to the nearest dollar amount. Omit the "P" sign in your response.) |
Expected increase in net operating income | P |
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