Lue Chance Co. sells computers and video game systems. The business is divided into two divisions along product lines. Variable costing income statements for the current year are presented below:
Computers VG Systems Total
Sales $700,000 $300,000 $1,000,000
Variable costs 420,000 210,000 630,000
Contribution margin $280,000 $90,000 370,000
Fixed costs 296,000
Net income $74,000
Required:
a. Determine the sales mix and contribution margin ratio for each division.
b. Calculate the company's weighted average contribution margin ratio.
c. Calculate the company's break-even point in dollars
d. Determine the sales level, in dollar, for each division at the break-even point.
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Lue Chance Co. sells computers and video game systems. The business is divided into two divisions al...
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