Steps to Perform: Instructions Points Step Possible Prepare Five Macaws' contribution margin income statement for last year. 10 (Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong.) a. Enter all amounts as positive values. Do not use a minus sign or parentheses for any values to be subtracted. b. Follow the format shown in Exhibit 6-22. Total Points 101 Cost Behavior 2 Prepare a contribution margin income statement 3 Five Macaws is a specialty pet gift shop selling exotic pet-related items online. The shop has no physical 4 location. Results for last year are shown next: 6 Five Macaws 7 Traditional Income Statement (Absorption Costing) 8 For the Year Ended December 31 g 10 Sales revenue 990,000 11 Less: Cost of goods sold 673,000 12 Gross profit 317,000 13 Less operating expenses: 14 Selling and marketing expenses $ 65,500 15 Website maintenance expenses 58,000 16 Other operating expenses 17,600 141,100 17 Operating income $ 175,900 18 For internal planning and decision-making purposes, the owner of Five Macaws would like to translate the company's income statement into the contribution margin format. Since Five Macaws is online only, all of its cost of goods sold is variable. A large portion of the selling and marketing expenses consists of freight-out charges ($19,400), which were also variable. Only 20% of the remaining selling and marketing expenses and 25% of the website expenses were variable. Of the other operating expenses, 19 90% were fixed. 20 21 Use the blue shaded areas on the ENTERANSWERS tab for inputs. Always use cell references and formulas where appropriate to receive full credit. If you copy/paste 22 from the Instructions tab you will be marked wrong. 23 24 Requirements 25 Prepare Five Macaws' contribution margin income statement for last year. 26 a. Enter all amounts as positive values. Do not use a minus sign or parentheses for any values to be subtracted. 27 b. Follow the format shown in Exhibit 6-22. 28 29 Saving & Submitting Solution INSTRUCTIONS ENTERANSWERS +AIBI C IDIEIFIGI Use the blue shaded areas on the ENTERANSWERS tab for inputs. Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions tab you will be marked wrong. Requirements Prepare Five Macaws' contribution margin income statement for last year. a. Enter all amounts as positive values. Do not use a minus sign or parentheses for any values to be subtracted. b. Follow the format shown in Exhibit 622. Saving 8: Submitting Solution 1 Save le to desktop. a. Create folder on desktop, and label COMPLETED EXCEL PROJECTS 2 Upload and submit your file to be graded. a. Navigate back to the activity window screen where you downloaded the initial spreadsheet b. Click Choose button under step 3; locate the file you just saved and click Open c. Click Upload button under step 3 d. Click Submit button under step 4 Viewing Results 1 Click on Results tab in MyAccountingLab 2 Click on the Assignment you were working on 3 Click on Project link; this will bring up your Score Card 4 Within Score Card window, click on Live Comments Report (lower right) to download spreadsheet with feedback INSTRUCTIONS ENTERANSWERS A B C D (Always use cell references and formulas where appropriate to receive full credit. If 1 you copy/paste from the Instructions tab you will be marked wrong.) 2 Five Macaws 4 Contribution Margin Income Statement 5 For the Year Ended December 31 Sales revenue 7 Less: Variable expenses 8 Variable cost of goods sold 9 Variable selling and marketing expenses 10 Variable web site maintenance expenses 11 Other variable operating expenses 12 Contribution margin 13 Less: Fixed expenses 14 Fixed selling and marketing expenses 15 Fixed web site maintenances expenses 16 Other fixed operating expenses 17 Operating income 18 19 20 21 INSTRUCTIONS ENTERANSWERS +