Cherokee inc. is a merchandiser that provided the following information:

Number of units sold………………………………………13,000

Selling price per unit………………………………………..$ 16

Variable selling expense per unit……………………..$ 1

Variable administrative expense per unit………….$ 2

Total fixed selling expense……………………………$ 20,000

Total fixed administrative expenses……………..$14,000

Beginning merchandise inventory…………………$10,000

Ending merchandise inventory………………………$24,000

Merchandise purchases…………………………………$87,000

Required:

1. prepare a traditional income statement.

Cherokee, Inc.
Traditional income statement
Sales		$208,000
Cost of goods sold		111,001
Gross margin
Selling and administrative expenses:	33,000
Selling expenses
Administrative expenses
		33,000
Net operating income