Ride EZ and Happy Trails are mountain bike retailers. This season a new bike, the Coaster, was introduced in the market. It was believed that the Coaster would be the most popular mountain bike sold during the season. Both companies sold the bike at the suggested retail price. At the end of each month during the season (May through September), store managers made notes of how many bikes were sold or purchased during the month. The following is a list of these notes:

The following information is also known:

• Suggested retail price is $600.

• The manufacturer sells the Coaster for a normal price of $275.

• Discounts of $25 off the normal price are given on purchases of 100 bikes or more.

• Average overhead costs used to purchase and initiate a purchase order for both retailers are $450 per event.

• Purchases are always made on the last day of the month.

• On June 15, the manufacturer raised the price of the Coaster to $290.

• Average inventory overhead costs for both retailers are $15 per unit per month.

• Both Ride EZ and Happy Trails account for inventory using FIFO.

Required:
Prepare a management accounting report for both Ride EZ and Happy Trails using the information given in theproblem.

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Happy Trails 150 bikes purchased 30 bikes sold Ride EZ 30 bikes purchased 27 bikes sold, out of stock; 30 more bikes are purchased Date May 1 May 31 35 bikes sold 29 bikes sold, out of stock; 30 more bikes are purchased 28 bikes sold, out of stock; 30 more bikes are purchased 24 bikes sold 4 bikes sold at cost; out of stock, no bikes purchased June 30 July 31 37 bikes sold Aug. 31 Sept. 30 24 bikes sold 13 bikes sold at cost out of stock, no bikes purchased