Exercise 6-5 Companywide and Segment Break-Even Analysis [LO6-5] Piedmont Compan
ID: 2542129 • Letter: E
Question
Exercise 6-5 Companywide and Segment Break-Even Analysis [LO6-5]
Piedmont Company segments its business into two regions—North and South. The company prepared the contribution format segmented income statement shown below:
Compute the companywide break-even point in dollar sales .
Compute the break-even point in dollar sales for the North region.
Compute the break-even point in dollar sales for the South region. (Round your break-even dollar sales to the nearest whole number.)
Piedmont Company segments its business into two regions—North and South. The company prepared the contribution format segmented income statement shown below:
Explanation / Answer
Compute the companywide break-even point in dollar sales
Compute the break-even point in dollar sales for the North region.
Compute the break-even point in dollar sales for the South region
Sales 11,56,250 Contribution margin 370000 CM Ratio = Contribution margin / Sales 32.00% Dollar sales for company to break even =Fixed Cost/CM Ratio =(156000+68000)/.32 700000