Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below: Sales Variable expenses Contribution margin. Fixed expenses Net operating income. Claimjumper $ 118,000 36,400 $ 81,600 Makeover $ 59,000 7,850 $ 51,150 Total $ 177,000 44,250 132,750 84,375 $ 48,375 Required: 1. What is the company's overall contribution margin (CM) ratio? 2. What is the company's overall break-even point in dollar sales? 3. Prepare a contribution format income statement at the company's break-even point that shows the appropriate levels of sales for the two products.
Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below: Sales Variable expenses Contribution margin. Fixed expenses Net operating income. Claimjumper $ 118,000 36,400 $ 81,600 Makeover $ 59,000 7,850 $ 51,150 Total $ 177,000 44,250 132,750 84,375 $ 48,375 Required: 1. What is the company's overall contribution margin (CM) ratio? 2. What is the company's overall break-even point in dollar sales? 3. Prepare a contribution format income statement at the company's break-even point that shows the appropriate levels of sales for the two products.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent
month for the two games appears below:
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income
Claimjumper
$ 118,000
36,400
$ 81,600
Makeover
$ 59,000
7,850
$ 51,150
Total
$ 177,000
44,250
132,750
84,375
$ 48,375
Required:
1. What is the company's overall contribution margin (CM) ratio?
2. What is the company's overall break-even point in dollar sales?
3. Prepare a contribution format income statement at the company's break-even point that shows the appropriate levels of sales for
the two products.
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