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Sales Less: Variable costs Contribution margin Less: Direct fixed costs Segment margin Less: Common fixed costs Operating income Regular Model $12,000,000 7,200,000 $4,800,000 1,200,000 $3,600,000 Deluxe Model units $10,880,000 6,528,000 $4,352,000 960,000 $3,392,000 units Total Required: 1. Compute the number of regular models and deluxe models that must be sold to break even. Round your answers to the nearest whole unit. $22,880,000 13,728,000 $9,152,000 2,160,000 $6,992,000 1,729,600 $5,262,400 Regular models Deluxe models 2. Using information only from the total column of the income statement, compute the sales revenue that must be generated for the company to break even. Round the contribution margin ratio to four decimal places. Use the rounded value in the subsequent computation. (Express as a decimal-based amount rather than a whole percentage.) Round the amount of revenue to the nearest dollar. Contribution margin ratio Revenue

Sales Less: Variable costs Contribution margin Less: Direct fixed costs Segment margin Less: Common fixed costs Operating income Regular Model $12,000,000 7,200,000 $4,800,000 1,200,000 $3,600,000 Deluxe Model units $10,880,000 6,528,000 $4,352,000 960,000 $3,392,000 units Total Required: 1. Compute the number of regular models and deluxe models that must be sold to break even. Round your answers to the nearest whole unit. $22,880,000 13,728,000 $9,152,000 2,160,000 $6,992,000 1,729,600 $5,262,400 Regular models Deluxe models 2. Using information only from the total column of the income statement, compute the sales revenue that must be generated for the company to break even. Round the contribution margin ratio to four decimal places. Use the rounded value in the subsequent computation. (Express as a decimal-based amount rather than a whole percentage.) Round the amount of revenue to the nearest dollar. Contribution margin ratio Revenue

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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Alo Company produces commercial printers. One is the regular model, a basic model that is designed to copy and print in black and white. Another model, the deluxe model, is a color printer-scanner-copier. For the coming year, Alo expects to sell 80,000 regular models and 16,000 deluxe models. A segmented income statement for the two products is as follows: Sales Less: Variable costs Contribution margin Less: Direct fixed costs Segment margin Less: Common fixed costs Operating income Regular models Deluxe models Regular Model $12,000,000 Revenue 7,200,000 $4,800,000 1,200,000 $3,600,000 units Deluxe Model units $10,880,000 6,528,000 $4,352,000 960,000 $3,392,000 Total $22,880,000 13,728,000 Required: 1. Compute the number of regular models and deluxe models that must be sold to break even. Round your answers to the nearest whole unit. $9,152,000 2,160,000 $6,992,000 1,729,600 $5,262,400 2. Using information only from the total column of the income statement, compute the sales revenue that must be generated for the company to break even. Round the contribution margin ratio to four decimal places. Use the rounded value in the subsequent computation. (Express as a decimal-based amount rather than a whole percentage.) Round the amount of revenue to the nearest dollar. Contribution margin ratio
Transcribed Image Text:Alo Company produces commercial printers. One is the regular model, a basic model that is designed to copy and print in black and white. Another model, the deluxe model, is a color printer-scanner-copier. For the coming year, Alo expects to sell 80,000 regular models and 16,000 deluxe models. A segmented income statement for the two products is as follows: Sales Less: Variable costs Contribution margin Less: Direct fixed costs Segment margin Less: Common fixed costs Operating income Regular models Deluxe models Regular Model $12,000,000 Revenue 7,200,000 $4,800,000 1,200,000 $3,600,000 units Deluxe Model units $10,880,000 6,528,000 $4,352,000 960,000 $3,392,000 Total $22,880,000 13,728,000 Required: 1. Compute the number of regular models and deluxe models that must be sold to break even. Round your answers to the nearest whole unit. $9,152,000 2,160,000 $6,992,000 1,729,600 $5,262,400 2. Using information only from the total column of the income statement, compute the sales revenue that must be generated for the company to break even. Round the contribution margin ratio to four decimal places. Use the rounded value in the subsequent computation. (Express as a decimal-based amount rather than a whole percentage.) Round the amount of revenue to the nearest dollar. Contribution margin ratio
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