Question

# Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a...

 Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below:
 Claimjumper Makeover Total Sales \$ 114,000 \$ 57,000 \$ 171,000 Variable expenses 35,200 7,550 42,750 Contribution margin \$ 78,800 \$ 49,450 128,250 Fixed expenses 83,925 Net operating income \$ 44,325

 Required: 1. Compute the overall contribution margin (CM) ratio for the company.

 2. Compute the overall break-even point for the company in dollar sales. (Do not round intermediate calculations. Round your final answer to the nearest dollar amount.)

 3. Complete the contribution format income statement at break-even point for the company showing the appropriate levels of sales for the two products. (Do not round intermediate calculations. Round your final answers to the nearest dollar amount.)

1) Overall Contribution Margin Ratio :-

= Total Contribution Margin / Total Sales

= \$128250 / \$171000

= 0.75 or 75%

2) Overall Break even point in Dollar :-

= Total Fixed Cost / Overall Contribution Margin Ratio

= \$83925 / 0.75

= \$111900

3) Income Statement :-

Sales at Break even point :-

 Particulars Claimjumper Makeove Total Sales Ratio (\$114000/\$171000)=0.6667 (\$57000/\$171000)=0.3333 1 Sales \$74600 \$37300 \$111900 Less : Variable Cost (\$23034) (\$4941) (\$27975) Contribution \$51566 \$32359 \$83925 Less : Fixed Cost (\$83925) Net Profit Nil

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