Per Unit

Sales Revenue

Variable expenses

Cost of goods sold

Commissions expense

Shipping expense

Total variable expense

Contribution Margin

Fixed expenses

Salaries expense

Advertising expense

Total fixed expenses

Operating income

11.

Anthony Herrera recently fulfilled his long-time dream of opening a gym that offers spinning exercise

classes for $5.83 per person. To differentiate his gym and better serve his clients, Anthony provides a

towel, a bottle of water, and an after-workout protein shake to each person participating in a class, at a

cost of $2.30 per person. Anthony employs three part-time instructors and pays them each $1,474 per

month. He also pays himself a monthly salary of $4,008. Anthony's other monthly costs are $1,574 for

rent, $1,408 for depreciation on his 30 bikes, and $1,898 in utilities and insurance.

a.

What is Anthony's contribution margin per unit?

b.

What is Anthony's contribution margin ratio?

c.

Prepare Anthony's monthly contribution format income statement. Assume that he teaches 5,375

clients