Mary Smith sells gourmet chocolate chip cookies. The results of her last month of operations are as follows:

Required

a. Prepare a contribution format income statement for Mary.

b. If Mary sells her cookies for $1.60 each, how many cookies did she sell during the month?

c. What is the contribution margin per cookie?

d. What is Mary’s contribution margin ratio?

Transcribed Image Text:

$50,000 25,575 Sales revenue Cost of goods sold (all variable) 24,425 8,000 12,000 Gross margin Selling expenses (20% variable) Administrative expenses (60% variable) $ 4,425 Operating income