Exercise 2-6 Traditional and Contribution Format Income Statements [LO2-6]

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

Number of units sold		20,000
Selling price per unit	$	30
Variable selling expense per unit	$	4
Variable administrative expense per unit	$	2
Total fixed selling expense	$	40,000
Total fixed administrative expense	$	30,000
Beginning merchandise inventory	$	24,000
Ending merchandise inventory	$	44,000
Merchandise purchases	$	180,000

Required:
1.	Prepare a traditional income statement.

2.	Prepare a contribution format income statement.

Cherokee, Inc Traditional ncome Statement Selling and administrative expenses