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Marlin Company, a wholesale distributor , has been operating for only a few mont

ID: 2374445 • Letter: M

Question

Marlin Company, a wholesale distributor, has been operating for only a few months. The company sells three products%u2014sinks, mirrors, and vanities. Budgeted sales by product and in total for the coming month are shown below:

Product

240,000

Fixed expenses

$223,600

As shown by these data, net operating income is budgeted at $36,400 for the month, and break-even sales at $430,000.

Assume that actual sales for the month total $500,000 as planned. Actual sales by product are: sinks, $160,000; mirrors, $200,000; and vanities, $140,000.

Prepare a contribution format income statement for the month based on actual sales data. (Input all amounts as positive values except losses which should be indicated by minus sign. Omit the "$" and "%" signs in your response.)

Product

Compute the break-even point in sales dollars for the month, based on your actual data. (Omit the "$" sign in your response.)

Explanation / Answer


Sinks Mirrors Vanities Total % 32% 40% 28% 500000 Sales 160000 200000 140000 500000 Variable 48000 160000 77000 285000 Contribution 112000 40000 63000 215000 43% Fixed Exp. 223600 Net Income 112000 40000 63000 -8600 BEP 223600/43% = 520000