Question

Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below:

 Sales Variable expenses Claimjumper $ 116,000 42,760 Makeover $ 58,000 9,440 Total $ 174,000 52,200 Contribution margin Fixed expenses $ 73,240 $ 48,560 121,800 77,280 Net operating income $ 44,520 

Required: 

1. Compute the overall contribution margin (CM) ratio for the company. Overall CM ratio 70% 

2. Compute the overall break-even point for the company in dollar sales. (Do not round intermediate culations. Round your final answer to the nearest dollar amount.) Overall break-even point $ 110,400

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.) 

Answer 1

Requirement 1

Contribution margin ratio

70%

Requirement 2

Overall Break-even point

$ 110,400.00

Requirement 3

Lucido Products
Contribution income statement
	Claimjumper	Makeover	Total
Sales	$          73,600	$              36,800	$        110,400
Variable expenses	$          27,130	$                 5,990	$           33,120
Contribution margin	$          46,470	$              30,810	$           77,280
Fixed cost			$           77,280
Net operating income (loss)			$                    -

Working

Sales	$ 174,000.00
Variable expenses	$    52,200.00
Contribution margin	$ 121,800.00
Contribution margin ratio	70%
Fixed cost	$    77,280.00
Overall Break-even point	$ 110,400.00

.

Lucido Products
Contribution income statement
	Claimjumper	Makeover
Sales	=116000/174000*110400	=58000/174000*110400
Variable expenses	=42760/116000*73600	=9440/58000*36800