Lucido Products markets two computer games Claimjumper and M

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

1. 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 answers to the nearest dollar amount.)

Claimjumper	Makeover	Total
Sales	$	98,000	$	49,000	$	147,000
Variable expenses		30,400		6,350		36,750
Contribution margin	$	67,600	$	42,650		110,250
Fixed expenses						87,750
Net operating income					$	22,500

Solution

Weighted Contribution margin rate: Total contribution/ Total sales *100 110250/147000 *100 = 75% Break even Point in $: Fixed cost/ Weighted Contribution margin ratio *100 87750/ 75 *100 = 117000 Sales mix of total product is 98:49 i.e. 2:1 Hence, Sales of two products at Break even is as follwos: Product Claim Jumper: 117000 *2/3 = $78000 Product Makeover: 117000*1/3 = $39000