Question

Gold Star Rice, Ltd., of Thailand exports Thai rice throughout Asia. The company grows three varieties of rice-White, Fragrant, and Loonzain. Budgeted sales by product and in total for the coming month are shown below: Percentage of total sales Sales Variable expenses Contribution margin Fixed expenses Net operating income White 48% $ 316,800 95,040 $ 221,760 100 % 30% 70% Product Fragrant Loonzain 20 % 32 % $ 132,000 100 % $ 211,200 100 % 105,600 80% 116, 160 55 % $ 26,400 20 % $ 95,040 45 % Total 100% $ 660,000 316,800 343,200 231,920 $ 111,280 100 % 48 % 52 % Dollar sales to break-even = – Fixed expenses CM ratio - $231,920 = $ 446,000 As shown by these data, net operating income is budgeted at $111,280 for the month and the estimated break-even sales is $446,000. Assume that actual sales for the month total $660,000 as planned. Actual sales by product are: White, $211,200; Fragrant, $264,000; and Loonzain, $184,800. Required: 1. Prepare a contribution format income statement for the month based on the actual sales data. the break-even point in dollar sales for the month based on your actual data.