Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Marwick's Planos, Incorporated, purchases planos from a manufacturer for an average cost of $1,516 per unit and then sells them to retail customers for
Marwick's Planos, Incorporated, purchases planos from a manufacturer for an average cost of $1,516 per unit and then sells them to retail customers for an average price of $2,400 each. The company's selling and administrative costs for a typical month are presented below: Costs Selling: Advertising Sales salaries and commissions Delivery of planos to customers Utilities Depreciation of sales facilities Administrative: Executive salaries Insurance Clerical Depreciation of office equipment Cost Formula $954 per month $4,810 per month, plus 5% of sales. $62 per piano sold $657 per month $4,960 per month $13,408 per month $681 per month $2,537 per month, plus $42 per piano sold $914 per month During August, Marwick's Pianos, Incorporated, sold and delivered 62 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.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Marwicks Planos Incorporated 1 Traditional Format Income Statement for August Revenues Sales 62 plan...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started