Question

Required Information The following information applies to the questions displayed below.] Raner, Harris & Chan is a consulting firm that specializes in Information systems for medical and dental clinics. The firm has two offices-one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented Income statement for the company's most recent year is given: Sales Variable expenses Contribution margin Traceable fixed expenses Office segment margin Common fixed expenses not traceable to offices Net operating income Total Company $ 412,500 100.0% 222,750 54.0% 189,750 46.0% 92,400 22.4% 97,350 23.6% 66,000 16.0% $ 31,350 7.6% Office Chicago Minneapolis $ 82,500 100% $ 330,000 100% 24,750 30% 198,000 60% 57,750 70% 132,000 40% 42,900 52% 49,500 15% $ 14.850 18% $ 82,500 25% Required: 1-a. Compute the companywide break-even point in dollar sales. 1-b. Compute the break-even point for the Chicago office and for the Minneapolis office. 1-c. Is the companywide break-even point greater than, less than, or equal to the sum of the Chicago and Minneapolis break-even points? Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Reg 10 Compute the companywide break-even point in dollar sales. (Round "CM ratio" to 2 decimal places and final answers to the nearest whole dollar amount.) Break-even point in dollar sales Reg 1A Reg 1B >

Answer 1

Break even point = Fixed costs/Contribution margin ratio
1a
Break even point in dollar sales	344348	=(92400+66000)/46%
1b
	Break-even point
Chicago Office	61286	=42900/70%
Minneapolis Office	123750	=49500/40%
1c
Greater than