Problem 1-21 (Algo) Traditional and Contribution Format Income Statements [LO1-6] Marwick's Pianos, Inc., purchases pianos from...

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Problem 1-21 (Algo) Traditional and Contribution Format Income Statements [LO1-6] Marwick's Pianos, Inc., purchases pianos from a large manufacturer for an average cost of $1,517 per unit and then sells them to retail customers for an average price of $2,800 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 $968 per month $4,788 per month, plus 4% of sales $62 per piano sold $640 per month $4,919 per month $13,517 per month $700 per month $2,460 per month, plus $36 per piano sold $892 per month During August, Marwick's Pianos, Inc., sold and delivered 58 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. Problem 1-21 (Algo) Traditional and Contribution Format Income Statements [LO1-6] Marwick's Pianos, Inc., purchases pianos from a large manufacturer for an average cost of $1,517 per unit and then sells them to retail customers for an average price of $2,800 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 $968 per month $4,788 per month, plus 4% of sales $62 per piano sold $640 per month $4,919 per month $13,517 per month $700 per month $2,460 per month, plus $36 per piano sold $892 per month During August, Marwick's Pianos, Inc., sold and delivered 58 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.