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Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming...

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Accounting

Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Variable cost is 35% of the sales price; contribution margin is 65% of the sales price. Total fixed cost equals $78,000 (includes fixed factory overhead and fixed selling and administrative expense).

Required:

1. Calculate the sales revenue that Chillmax must make to break even by using the break-even point in sales equation. $fill in the blank 8fe580072fc4faf_1

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Break-Even in Sales = Total Fixed Expenses
Contribution Margin Ratio

Review the "How to Calculate the Break-Even Point in Sales Dollars" example in your text.

2. Prepare a contribution margin income statement based on the break-even point in sales dollars. Enter all amount as a positive number.

Chillmax Company Contribution Margin Income Statement At Break-Even Point
Total
Sales
Total variable cost
Total contribution margin
Total fixed cost
Operating income

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