Marwicks Pianos, Inc., purchases pianos 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 companys selling and administrative costs for a typical month are presented below:

Costs	Cost Formula
Selling:
Advertising	$	935 per month
Sales salaries and commissions	$	4,808 per month, plus 5% of sales
Delivery of pianos to customers	$	57 per piano sold
Utilities	$	647 per month
Depreciation of sales facilities	$	5,043 per month
Administrative:
Executive salaries	$	13,511 per month
Insurance	$	699 per month
Clerical	$	2,470 per month, plus $42 per piano sold
Depreciation of office equipment	$	871 per month

During August, Marwicks Pianos, Inc., sold and delivered 63 pianos.

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.

Required 1

Prepare a traditional format income statement for August. (A "Net operating loss" should be entered as a negative number.)

Marwick's Pianos, Inc.
Traditional Income Statement
For the Month of August
Selling and administrative expenses:
Selling expenses:
Total selling expenses
Administrative expenses:
Total administrative expenses
Total selling and administrative expenses

Required 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. (A "Net operating loss" should be entered as a negative number.)

Marwick's Pianos, Inc.
Contribution Format Income Statement
For the Month of August
	Total	Per Piano
Variable expenses:
Total variable expenses
Contribution margin
Fixed expenses:
Total fixed expenses