Ritchie Manufacturing Company makes a product that it sells for $170 per unit. The company incurs variable manufacturing costs of $83 per unit. Variable selling expenses are $19 per unit, annual fixed manufacturing costs are $498,000, and fixed selling and administrative costs are $236,400 per year.

Required

Determine the break-even point in units and dollars using each of the following approaches:

1. Use the equation method.

2. Use the contribution margin per unit approach.

3. Prepare a contribution margin income statement for the break-even sales volume.

Complete this question by entering your answers in the tabs below.

• Req A to B
• Req C

Prepare a contribution margin income statement for the break-even sales volume.

RITCHIE MANUFACTURING COMPANY
Contribution Margin Income Statement
Salesselected answer correct	$1,836,000selected answer correct
Fixed costsselected answer incorrect	896,400selected answer incorrect
Contribution lossselected answer incorrect	not attempted
Selling expensesselected answer incorrect	205,200selected answer incorrect
Cost of goods soldselected answer incorrect	498,000selected answer incorrect
Net incomeselected answer correct	$0selected answer correct

Complete this question by entering your answers in the tabs below. Req A to B Req C Prepare a contribution margin income statement for the break-even sales volume. RITCHIE MANUFACTURING COMPANY Contribution Margin Income Statement $ 1,836,000 Sales 896,400 Fixed costs Contribution margin 205,200 Selling expenses 498,000 Cost of goods sold Fixed costs Req A to B Req C Sales Selling expenses Variable costs