Problem 5-21 (Algo) Sales Mix; Multiproduct Break-Even Analysis [LO5-9]

Gold Star Rice, Limited, of Thailand exports Thai rice throughout Asia. The company grows three varieties of riceWhite, Fragrant, and Loonzain. Budgeted sales by product and in total for the coming month are shown below:

	Product
	White		Fragrant		Loonzain		Total
Percentage of total sales	48%		20%		32%		100%
Sales	$ 360,000	100%	$ 150,000	100%	$ 240,000	100%	$ 750,000	100%
Variable expenses	108,000	30%	120,000	80%	132,000	55%	360,000	48%
Contribution margin	$ 252,000	70%	$ 30,000	20%	$ 108,000	45%	390,000	52%
Fixed expenses							231,400
Net operating income							$ 158,600

Dollar sales to break-even = Fixed expenses / CM ratio = $231,400 / 0.52 = $445,000

As shown by these data, net operating income is budgeted at $158,600 for the month and the estimated break-even sales is $445,000.

Assume that actual sales for the month total $750,000 as planned; however, actual sales by product are: White, $240,000; Fragrant, $300,000; and Loonzain, $210,000.

Required:

1. Prepare a contribution format income statement for the month based on the actual sales data.

2. Compute the break-even point in dollar sales for the month based on your actual data.

Problem 5-21 (Algo) Sales Mix; Multiproduct Break-Even Analysis (LO5-9) Gold Star Rice, Limited, of Thailand exports Thai rice throughout Asia. The company grows three varieties of rice-White, Fragrant, and Loonzain. Budgeted sales by product and in total for the coming month are shown below: White 48% $ 360,000 108,000 $ 252,000 100% 308 Percentage of total sales Sales Variable expenses Contribution margin Fixed expenses Net operating income Fragrant 20% $ 150,000 120,000 $ 30,000 Product Loonzain 32% 100% $ 240,000 100% 80% 132,000 55% 20% $ 108,000 45% 100% 48% Total 100% $ 750,000 360,000 390,000 231,400 $ 158,600 70% 52% Dollar sales to break-even = Fixed expenses / CM ratio = $231,400 / 0.52 = $445,000 As shown by these data, net operating income is budgeted at $158,600 for the month and the estimated break-even sales is $445,000. Assume that actual sales for the month total $750,000 as planned; however, actual sales by product are: White, $240,000; Fragrant, $300,000; and Loonzain, $210,000. Required: 1. Prepare a contribution format income statement for the month based on the actual sales data. 2. Compute the break-even point in dollar sales for the month based on your actual data. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a contribution format income statement for the month based on the actual sales data. Gold Star Rice, Limited Contribution Income Statement Product White Fragrant Loonzain Total Percentage of total sales % % % % % % % % % % % % % %