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I don't know how to make the variable income statements and other statements required for the following data; Price Categories A B C D E

I don't know how to make the variable income statements and other statements required for the following data;

Price Categories

A

B

C

D

E

Units Sold

2,000

1,000

500

400

400

Units Purchased

3,000

1,200

1,000

1,000

1,000

Resale Price

$4.00

$15.00

$25.00

$45.00

$40.00

Cost

$0.50

$5.00

$10.00

$20.00

$20.00

In addition to purchasing inventory (used books), the company incurs some operating expenses.

Variable operating expenses

Shipping per book

$ 1.50

Fixed expenses

Internet-related costs

$5,000

Travel, etc.

2,000

Advertising

1,000

Other overhead

3,000

Required:

Computations (use Excel)

  • Prepare a segmented variable costing (behavioral) income statement for the company in good format.
  • Prepare a second variable costing statement assuming 90% of all the books in each category purchased were actually sold.
  • Prepare a third variable costing statement assuming that the price is increased by 50% for all five categories (use original sales information).
  • The owner enjoys the used-book business. Any suggestions as how to turn this into a full-time business venture so the owner can quit his other job? Prepare another income statement to support your idea.

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