Marwicks Pianos, Inc., purchases pianos from a large manufacturer for an average cost of $1,502 per unit and then sells them to retail customers for an average price of $2,200 each. The companys selling and administrative costs for a typical month are presented below:

Costs	Cost Formula
Selling:
Advertising	$	943 per month
Sales salaries and commissions	$	4,788 per month, plus 4% of sales
Delivery of pianos to customers	$	62 per piano sold
Utilities	$	649 per month
Depreciation of sales facilities	$	4,907 per month
Administrative:
Executive salaries	$	13,513 per month
Insurance	$	703 per month
Clerical	$	2,462 per month, plus $39 per piano sold
Depreciation of office equipment	$	911 per month

During August, Marwicks Pianos, Inc., sold and delivered 56 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.

Complete this question by entering your answers in the tabs below.

• Required 1
• Required 2

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

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