Exercise 1-6 (Algo) Traditional and Contribution Format Income Statements [LO1-6]

Cherokee Incorporated is a merchandiser that provided the following information:

	Amount
Number of units sold	11,000
Selling price per unit	$ 16
Variable selling expense per unit	$ 1
Variable administrative expense per unit	$ 3
Total fixed selling expense	$ 21,000
Total fixed administrative expense	$ 15,000
Beginning merchandise inventory	$ 12,000
Ending merchandise inventory	$ 25,000
Merchandise purchases	$ 90,000

Required:

1. Prepare a traditional income statement.
2. Prepare a contribution format income statement.