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How do verify the overall break-even point for the company

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Reference no: EM132624645

Park Company markets two computer games: Ping and Pong. A contribution format income statement for a recent month for the two games appears below:

                                                   Ping                     Pong                    Total

Sales                                  P100,000              P50,000        P150,000

Variable expenses                      25,000                  5,000        30,000

Contribution margin                  P 75,000                P45,000      P120,000

Fixed expenses                           90,000

Net operating income                P 30,000

Required:

Question 1. Compute the overall contribution margin ratio

Question 2. Compute the overall break-even point for the company in sales pesos.

Question 3. Verify the overall break-even point for the company by constructing a contribution format income statement showing the appropriate levels of sales for the two products.

Reference no: EM132624645

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