Question

Product Flight Sure Dynamic Shot $ 740,000 $ 260,000 64% 788 Total $1,000,000 Sales CM ratio Fixed expenses total $588,000 per month Required: 1. Prepare a contribution format income statement for the company as a whole. 2. What is the company's break-even point in dollar sales based on the current sales mix? 3. If sales increase by $56,000 a month, by how much would you expect the monthly net operating income to increase? X Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a contribution format income statement for the company as a whole. (Round your percentage answers to 2 decimal places (i.e. 0.1234 should be entered as 12.34).) Flight Dynamic Amount % $ 740,000 100.00 % 162,800 61.00 $ % $ 577,200 39.00 % Sure Shot Amount % $ 260,000 100.00 57,200 78.00 $ 202,800 22.00 Sales Variable expenses Contribution margin Fixed expenses Net operating income % % % Total Company Amount 1,000,000 100.00 220,000 22.00 780,000 78.00 588,000 $ 192,000 % % on %

Answer 1

Requirement: 1 Sales Variable expenses Contribution margin Fixed expenses Net operating income Flight Dynamic Amount % 740000 100.00% 266400[ 36.00% 473600 64.00% Sure shot Amount % 260000 100.00% 57200 22.00% 202800 78.00% Total Company Amount % 1000000 100.00% 323600 32.36% 676400 67.64% 588000 88400

Requirement: 2 Fixed expenses 588000 Dollar sales to break even Overall CM Ratio | = | Break even point (Dollars) 67.64% 869308 Requirement: 3 Increase sales 56000 | x CM Ratio 67.64% = Operating income to increase 37878