Use the Following Information for Items

question 57

Multiple Choice

Use the following information for items
Ed Green Corporation has two divisions; Outdoor Sports and Indoor Sports.The sales mix is 60% for Outdoor Sports and 40% for Indoor Sports.Green incurs $2,420,000 in fixed costs.The contribution margin ratio for the Outdoor Sports Division is 40%, while for the Indoor Sports Division it is 50%.
-The break-even point in dollars is

• A)$985,600.
• B)$4,869,565.
• C)$4,977,777.
• D)$5,500,000.

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Definitions:

Fair Value

The estimated price at which an asset could be bought or sold in a current transaction between willing parties, other than in a liquidation sale.

Equity Method Investments

Investments in which the investor has significant influence, but not control, over the investee, and the investment is accounted for using the equity method, recognizing the investor's share of the investee's profits and losses.

Cash Dividends

A cash distribution of profits by a corporation to its shareholders.

Investment Revenue

Income generated from investing capital, such as dividends, interest, or profits from asset sales.