Question
House of Organs, Inc., purchases organs from a well-known manufacturer and sells them at the retail level. The organs sell, on the average, for $3,300
House of Organs, Inc., purchases organs from a well-known manufacturer and sells them at the retail level. The organs sell, on the average, for $3,300 each. The average cost of an organ from the manufacturer is $1,511. The costs that the company incurs in a typical month are presented below: |
Costs | Cost Formula |
Selling: | |
Advertising | $959 per month |
Delivery of organs | $62 per organ sold |
Sales salaries and commissions | $4,829 per month, plus 5% of sales |
Utilities | $631 per month |
Depreciation of sales facilities | $4,947 per month |
Administrative: | |
Executive salaries | $13,417 per month |
Depreciation of office equipment | $860 per month |
Clerical | $2,456 per month, plus $36 per organ sold |
Insurance | $703 per month |
During November, the company sold and delivered 60 organs. |
Required: | |
1. | Prepare a traditional income statement for November. (Input all amounts as positive values except losses which should be indicated by a minus sign. Omit the "$" sign in your response.) |
House Of Organs, Inc. Traditional Income Statement For the Month Ended November 30 | ||
(Click to select)Cost of goods soldUtilitiesDelivery of organsClericalAdvertisingSalesDepreciation of sales facilitiesDepreciation of office equipmentSales salaries and commissionsExecutive salaries | $ | |
(Click to select)Cost of goods soldInsuranceSalesDepreciation of office equipmentAdvertisingDepreciation of sales facilitiesUtilitiesSales salaries and commissionsClericalDelivery of organs | ||
(Click to select)Gross lossGross marginNet operating incomeNet operating loss | ||
Selling and administrative expenses: | ||
Selling expenses: | ||
(Click to select)AdvertisingDepreciation of office equipmentInsuranceUtilitiesDelivery of organsExecutive salariesClericalCost of goods sold Sales salaries and commissionsDepreciation of sales facilities | $ | |
(Click to select)Sales salaries and commissionsClericalUtilitiesDelivery of organsDepreciation of office equipmentExecutive salariesCost of goods sold AdvertisingDepreciation of sales facilitiesInsurance | ||
(Click to select)Executive salariesAdvertisingDelivery of organsDepreciation of office equipmentClericalInsuranceUtilitiesCost of goods sold Depreciation of sales facilitiesSales salaries and commissions | ||
(Click to select)Executive salariesSales salaries and commissionsDelivery of organsDepreciation of sales facilitiesCost of goods sold UtilitiesAdvertisingClericalDepreciation of office equipmentInsurance | ||
(Click to select)InsuranceDepreciation of office equipmentDepreciation of sales facilitiesUtilitiesAdvertisingDelivery of organsClericalSales salaries and commissionsExecutive salariesCost of goods sold | ||
Total selling expenses | ||
Administrative expenses: | ||
(Click to select)InsuranceClericalAdvertisingUtilitiesCost of goods sold Executive salariesDepreciation of sales facilitiesDelivery of organs Depreciation of office equipmentSales salaries and commissions | ||
(Click to select)Delivery of organs AdvertisingInsuranceSales salaries and commissionsDepreciation of sales facilitiesUtilitiesDepreciation of office equipmentClericalExecutive salariesCost of goods sold | ||
(Click to select)InsuranceDepreciation of sales facilitiesDepreciation of office equipmentAdvertisingExecutive salariesDelivery of organs ClericalUtilitiesSales salaries and commissionsCost of goods sold | ||
(Click to select)UtilitiesClericalInsuranceDepreciation of office equipmentDepreciation of sales facilitiesSales salaries and commissionsExecutive salariesAdvertisingDelivery of organs Cost of goods sold | ||
Total administrative expenses | ||
Total selling and administrative expenses | ||
(Click to select)Contribution marginNet operating lossGross marginNet operating income | $ | |
2. | Prepare a contribution format income statement for November. (Input all amounts as positive values except losses which should be indicated by a minus sign. Omit the "$" sign in your response.) |
House Of Organs, Inc. Contribution Format Income Statement For the Month Ended November 30 | ||
Total | Per unit | |
(Click to select)UtilitiesDepreciation of office equipmentInsuranceExecutive salariesClericalSales commissionsAdvertisingDelivery of organsCost of goods soldSales | $ | $ |
Variable expenses: | ||
(Click to select)Depreciation of office equipmentDepreciation of sales facilitiesCost of goods soldUtilitiesAdvertisingSalesSales salariesMaintenanceExecutive salariesInsurance | ||
(Click to select)MaintenanceUtilitiesDepreciation of sales facilitiesSalesAdvertisingSales salariesInsuranceDelivery of organsDepreciation of office equipmentExecutive salaries | ||
(Click to select)UtilitiesMaintenanceDepreciation of office equipmentInsuranceSales salariesSales commissionsDepreciation of sales facilitiesExecutive salariesAdvertisingSales | ||
(Click to select)AdvertisingClericalDepreciation of office equipmentInsuranceSales salariesExecutive salariesUtilitiesMaintenanceDepreciation of sales facilitiesSales | ||
Total variable expenses | ||
Contribution margin | $ | |
Fixed expenses: | ||
(Click to select)AdvertisingDepreciation of sales facilitiesClericalExecutive salariesInsuranceDepreciation of office equipmentDelivery of organsCost of goods sold UtilitiesSales salaries | ||
(Click to select)Executive salariesSales salariesClericalAdvertisingUtilitiesDelivery of organsDepreciation of office equipmentInsuranceCost of goods sold Depreciation of sales facilities | ||
(Click to select)Depreciation of sales facilitiesDelivery of organsSales salariesInsuranceUtilitiesDepreciation of office equipmentAdvertisingClericalExecutive salariesCost of goods sold | ||
(Click to select)UtilitiesDepreciation of sales facilitiesDepreciation of office equipmentAdvertisingExecutive salariesCost of goods sold ClericalSales salariesInsuranceDelivery of organs | ||
(Click to select)AdvertisingDelivery of organsDepreciation of sales facilitiesClericalCost of goods sold InsuranceExecutive salariesSales salariesDepreciation of office equipmentUtilities | ||
(Click to select)Delivery of organsExecutive salariesSales salariesCost of goods sold ClericalAdvertisingInsuranceDepreciation of sales facilitiesUtilitiesDepreciation of office equipment | ||
(Click to select)InsuranceAdvertisingUtilitiesCost of goods sold Depreciation of office equipmentDelivery of organsClericalExecutive salariesSales salariesDepreciation of sales facilities | ||
(Click to select)Cost of goods sold AdvertisingDepreciation of sales facilitiesClericalDelivery of organsInsuranceExecutive salariesUtilitiesSales salariesDepreciation of office equipment | ||
Total fixed expenses | ||
(Click to select)Gross marginNet operating lossContribution marginNet operating income | $ | |
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