Todrick Company is a merchandiser that reported the following information based on 1,000 units sold: Sales $ 450,000 Beginning merchandise inventory $ 30,000 Purchases $ 300,000 Ending merchandise inventory $ 15,000 Fixed selling expense $ ? Fixed administrative expense $ 18,000 Variable selling expense $ 22,500 Variable administrative expense $ ? Contribution margin $ 90,000 Net operating income $ 27,000 Required: 1. Prepare a contribution format income statement. 2. Prepare a traditional format income statement. 3. Calculate the selling price per unit. 4. Calculate the variable cost per unit. 5. Calculate the contribution margin per unit. 6. Which income statement format (traditional format or contribution format) would be more useful to managers in estimating how net operating income will change in responses to changes in unit sales?

Req 1 Req 2 Req 3 to 5 Reg 6 Prepare a contribution format income statement. Todrick Company Contribution Format Income Statement Variable expenses: Fixed expenses: Req 1 Reg 2 Req 3 to 5 Req 6 Prepare a traditional format income statement. Todrick Company Traditional Income Statement Selling and administrative expenses: Reg 1 Req 2 Req 3 to 5 Req 6 3. Calculate the selling price per unit. 4. Calculate the variable cost per unit. 5. Calculate the contribution margin per unit. 3. Selling price per unit 4. Variable cost per unit 5. Contribution margin per unit Reg 1 Req 2 Req 3 to 5 Req 6 Which income statement format (traditional format or contribution for how net operating income will change in responses to changes in unit Traditional income statement Contribution income statement