Home Entertainment is a small, family-owned business that purchases LCD televisions from a reputable manufacturer and sells them at the retail level. The televisions sell, on average, for $2,290 each. The average cost of a television from the manufacturer is $1,400.

Home Entertainment has always kept careful accounting records, and the costs that it incurs in a typical month are as follows:

Costs	Cost Formula
Selling:
Advertising	$	1,400	per month
Delivery of televisions	$	42	per television sold
Sales salaries and commissions	$	3,090	per month, plus 10% of sales
Utilities	$	550	per month
Depreciation of sales facilities	$	3,170	per month
Administrative:
Executive salaries	$	8,600	per month
Depreciation of office equipment	$	960	per month
Clerical	$	1,790	per month, plus $41 per television sold
Insurance	$	710	per month

During April, the company sold and delivered 190 televisions.

Required:

1. Prepare an income statement for April using the traditional format with costs organized by function.

2. Prepare an income statement for April, this time using the contribution format with costs organized by behaviour. Show costs and revenues on both a total and a per unit basis down through contribution margin.

HOME ENTERTAINMENT Traditional Income Statement For the Month Ended April 30 Selling and administrative expenses: Total selling expenses Administrative expenses Total administrative expenses Total selling and administrative expenses HOME ENTERTAINMENT Contribution Format Income Statement For the Month Ended April 30 Total Per Unit Variable expenses: Total variable expenses Fixed expenses: Total fixed expenses