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TheEastex Valley Company is a merchandising firm that sells a single product. The company's revenues and expenses for the last three months are given below:
TheEastex Valley Company is a merchandising firm that sells a single product. The company's revenues and expenses for the last three months are given below:
Middlesex Valley Company | |||
Comparative Income Statement | |||
For the Second Quarter | |||
April | May | June | |
Sales in units | 4,500 | 5,250 | 6,000 |
Sales Revenue | $630,000 | $735,000 | $840,000 |
Cost of goods sold | $252,000 | $294,000 | $336,000 |
Gross margin | $378,000 | $441,000 | $504,000 |
Selling and administrative expenses: | |||
Shipping expense | $56,000 | $63,500 | $71,000 |
Advertising expense | $70,000 | $70,000 | $70,000 |
Salaries and commisions | $143,000 | $161,500 | $180,500 |
Insurance expense | $9,000 | $9,000 | $9,000 |
Depreciation expense | $42,000 | $42,000 | $42,000 |
Total selling and administrative expense | $320,000 | $346,250 | $372,500 |
Net operating income | $58,000 | $94,750 | $131,500 |
Compute the company's total contribution margin for April.
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