Remo Company and Angelo Inc. are separate companies that operate in the same ind

Question

Remo Company and Angelo Inc. are separate companies that operate in the same industry. Following are variable costing income statements for the two companies showing their different cost structures:

Calculate the break-even sales revenue for each company. (Round your "Contribution Margin Ratio Percentage" to 2 decimal places and final answers to 2 decimal places.)

Break-Even Sales Revenue

(Remo Co.):

(Angelo Inc.):

Remo Company and Angelo Inc. are separate companies that operate in the same industry. Following are variable costing income statements for the two companies showing their different cost structures:

Explanation / Answer

Calculate the break-even sales revenue for each company. (Round your "Contribution Margin Ratio Percentage" to 2 decimal places and final answers to 2 decimal places.)

Contribution Margin Ratio

(Remo Co.):125000/325000 = 38.46%

(Angelo Inc.): 200000/325000 = 61.54%

Break-Even Sales Revenue

(Remo Co.): = Fixed Cost/Contribution Margin Ratio = 50000/38.46% = $ 130,005.20

(Angelo Inc.): = Fixed Cost/Contribution Margin Ratio = 125000/61.54% = $ 203,119.92

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