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i need help figuring out the contribution format income statement. i fugured out the traditional one so i uploded it for background info Marwick's Pianos,
i need help figuring out the contribution format income statement. i fugured out the traditional one so i uploded it for background info
Marwick's Pianos, Inc., purchases planos from a large manufacturer for an average cost of $1.492 per unit and then sells them to retail customers for an average price of $2,500 each. The company's selling and administrative costs for a typical month are presented below: Cost Formula Costs Selling: Advertising Sales salaries and commissions Delivery of panos to customers Utilities Depreciation of sales facilities Administrative: Executive salaries Insurance Clerical Depreciation of office equipment $965 per month $4,803 per month, plus 5% of sales $58 per piano sold $635 per month $4,996 per month $13,506 per month $714 per month $2,539 per month, plus 544 per piano sold $929 per month During August, Marwick's Planos, Inc., sold and delivered 55 planos. Required: 1. Prepare a traditional format income statement for August. 2. Prepare a contribution format income statement for August. Show costs and revenues on both a total and a per unit basis down through contribution margin. Traditional Income Statement For the Month of August Sales $ 137,500 82,060 55,440 Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses: Advertising Sales salaries and commissions Delivery of pianos Depreciation of sales facilities Utilities $ 965 11,678 3,190 4,996 635 21,464 13,506 Total selling expenses Administrative expenses: Executive salaries Insurance Clerical Depreciation of office equipment 714 4,959 929 Total administrative expenses 20,108 Step by Step Solution
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