Question
Question 1: Video Magic, Inc. has the following information available for December 2021. Unit selling price of video game consoles $ 325 Unit variable costs
Question 1:
Video Magic, Inc. has the following information available for December 2021. Unit selling price of video game consoles $ 325 Unit variable costs $ 210 Total fixed costs $44,850 Units sold 405 Required: (a) Prepare a CVP income statement that shows both total and per unit amounts. (b) Compute Video Magic's breakeven in units.
Question 2: East Bay Electronics, Inc. sells stereo and home theater systems. The business is divided into two divisions along product lines. Variable costing income statements for the current 2021 year are presented below: Stereos HT Systems Total Sales $250,000 $750,000 $1,000,000 Variable costs 165,000 330,000 495,000 Contribution margin $85,000 $ 420,000 505,000 Fixed costs 410,000 Net income $ 95,000 Required: (a) Determine the sales mix and contribution margin ratio for each division. (b) Calculate the companys weighted-average contribution margin ratio. (c) Calculate the companys breakeven point in dollars. (d) Determine the sales level, in dollars, for each division at the breakeven point.
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