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The Alpine House, Inc. is a large retailer of winter sports equipment. Here is an income statement for the company's Ski department for a recent
The Alpine House, Inc. is a large retailer of winter sports equipment. Here is an income statement for the company's Ski department for a recent quarter:
THE ALPINE HOUSE, INC.
Income StatementSki Department
For the Quarter Ended March
Sales
Less: Cost of goods sold
Gross margin
Less: Operating expenses:
Selling expenses $
Administrative expenses
Net income
On average, skis sell for $ per pair. Variable selling expenses are $ per pair of skis sold. The remaining selling expenses are fixed. The administrative expenses are variable and fixed. The company does not manufacture its own skis; it purchases them from a supplier for $ per pair.
Required:
Prepare a contribution margin income statement for the quarter.
tableTHE ALPINE HOUSE, INC.,Contribution Margin Income StatementSki Department,For the Quarter Ended March Less: Variable expenses:,,Cost of goods sold,,Less: Fixed expenses:,,For every pair of skis sold during the quarter, what was the contribution toward
covering fixed expenses and toward earning profits?
Contribution margin
per pair
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