Cost Volume Profit. ABC produces and sells two products. Data concerning those products for the most recent month appear below: B Total Sales $20,000 10,000 $10,000 $80,000 $100,000 Variable expenses 50,000 60,000 Contribution margin Fixed $30,000 40,000 30,000 $10,000 expenses Net operating income Required: 1. Compute the overall break-even point for the company in sales dollars. Weighted CMratio: CM 40k/sales 100k = 40% FC/CM 30k / CMratio (40k/100k) 30k/.4 = 75,000 2. Verify the overall break-even point for the company by calculating the appropriate levels of total sales for the two products [Note: Only total sales are required for each product, and no need to calculate variable expenses and other components of income statement].

Cost Volume Profit. ABC produces and sells two products. Data concerning those products for the most recent month appear below: B Total Sales $20,000 10,000 $10,000 $80,000 $100,000 Variable expenses 50,000 60,000 Contribution margin Fixed $30,000 40,000 30,000 $10,000 expenses Net operating income Required: 1. Compute the overall break-even point for the company in sales dollars. Weighted CMratio: CM 40k/sales 100k = 40% FC/CM 30k / CMratio (40k/100k) 30k/.4 = 75,000 2. Verify the overall break-even point for the company by calculating the appropriate levels of total sales for the two products [Note: Only total sales are required for each product, and no need to calculate variable expenses and other components of income statement].

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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