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JKL Inc. markets two computer games: Game 101 and Game 102. A contribution format income statement for a recent month for the two games appears below:                                         101     102 Sales                          P30,000 P70,000 Variable expenses.   20,000 50,000 Required: a. Compute the overall contribution margin (CM) ratio for the company.       b. Compute the overall break-even point for the company in sales dollars if fixed cost is P15,000.       c. Verify the overall break-even point for the company by constructing a contribution format income statement showing the appropriate levels of sales for the two products.

JKL Inc. markets two computer games: Game 101 and Game 102. A contribution format income statement for a recent month for the two games appears below:                                         101     102 Sales                          P30,000 P70,000 Variable expenses.   20,000 50,000 Required: a. Compute the overall contribution margin (CM) ratio for the company.       b. Compute the overall break-even point for the company in sales dollars if fixed cost is P15,000.       c. Verify the overall break-even point for the company by constructing a contribution format income statement showing the appropriate levels of sales for the two products.

FINANCIAL ACCOUNTING
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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JKL Inc. markets two computer games: Game 101 and Game 102. A contribution format income statement for a recent month for the two games appears below:

                                        101     102
Sales                          P30,000 P70,000
Variable expenses.   20,000 50,000

Required:
a. Compute the overall contribution margin (CM) ratio for the company.

 

 

 

b. Compute the overall break-even point for the company in sales dollars if fixed cost is P15,000.

 

 

 


c. Verify the overall break-even point for the company by constructing a contribution format income statement showing the appropriate levels of sales for the two products.

 

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