Marwick's Pianos, Incorporated, purchases pianos from a manufacturer for an average cost of $1,505 per unit...
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Marwick's Pianos, Incorporated, purchases pianos from a manufacturer for an average cost of $1,505 per unit and then sells them to retail customers for an average price of $2,600 each. The company's selling and administrative costs for a typical month are presented below: Costs Selling: Advertising Sales salaries and commissions Delivery of pianos to customers Utilities Depreciation of sales facilities Administrative: Executive salaries Insurance Clerical Depreciation of office equipment Cost Formula $962 per month $4,799 per month, plus 5% of sales $59 per piano sold $667 per month $5,032 per month. $13,508 per month $702 per month $2,475 per month, plus $35 per piano sold $937 per month During August, Marwick's Pianos, Incorporated, sold and delivered 60 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. Marwick's Pianos, Incorporated, purchases pianos from a manufacturer for an average cost of $1,505 per unit and then sells them to retail customers for an average price of $2,600 each. The company's selling and administrative costs for a typical month are presented below: Costs Selling: Advertising Sales salaries and commissions Delivery of pianos to customers Utilities Depreciation of sales facilities Administrative: Executive salaries Insurance Clerical Depreciation of office equipment Cost Formula $962 per month $4,799 per month, plus 5% of sales $59 per piano sold $667 per month $5,032 per month. $13,508 per month $702 per month $2,475 per month, plus $35 per piano sold $937 per month During August, Marwick's Pianos, Incorporated, sold and delivered 60 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.
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contribution format income statement Given information Average cost per unit 1505 Average selling price per unit 2600 Number of pianos sold and delive... View the full answer
Related Book For
Managerial Accounting
ISBN: 9781260247787
17th Edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
Posted Date:
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