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Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below:
Claimjumper Makeover TotalSales $ 120,000 $ 60,000 $ 180,000Variable expenses 37,000 8,000 45,000Contribution margin $ 83,000 $ 52,000 135,000Fixed expenses 85,275Net operating income $ 49,725
Required:
Problem 1. What is the overall contribution margin (CM) ratio for the company?
Problem 2. What is the company's overall break-even point in dollar sales?
Problem 3. Prepare a contribution format income statement at the company's break-even point that shows the appropriate levels of sales for the two products.
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