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Required information The following information applies to the questions displayed below.] Henna Co. produces and sells two products, T and O. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 56,000 units of each product Sales and costs for each product follow. 929,600 650,720 278,880 132,880 146,000 51,100 $ 94,900 929,600 Variable costs Contribution margin Fixed costs Income before taxes Income taxes (32% rate) Net incone 597,680 146,000 51,109 $ 94,90 s 94 Required 1. Compute the break-even point in dollar sales for each pro es.) 22 23 24 of 24 İll Next > here to search
Required: 1. Compute the break-even point in dollar sales for each product. (Enter CM ratio as percentage rounded to 2 decimal places.) Choose Nu Ch Next >
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Answer #1

Product T Contribution Margin Ratio Choose Numerator Choose Denominator Contribution Margin Ratio 78880 929600 0.30 i.e. 30% Break-even point in dollars Choose Numerator Choose Denominator Break-even point in dollars 132880 0.30 442933.33 ProductO Contribution Margin Ratio Choose Numerator Choose Denominator Contribution Margin Ratio 743680 929600 0.80 i.e. 80% Break-even point in dollars Choose Numerator Choose Denominator Break-even point in dollars 597680 0.80 747100

Note :

1) Contribution Margin ratio = (Contribution / Sales)*100

2) Break even point = (Fixed costs / Contribution margin ratio)

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