Topper Sports, Inc., produces high-quality sports equipment. The company's Racket Division manufactures three tennis rackets-the Standard, the Deluxe, and the Pro--that are widely used in amateur play. Selected information on the rackets is given below. Standard $ 70.ee Deluxe $ 106.ee Pro $160.00 Selling price per racket Variable expenses per racket: Production Selling (5% of selling price) $ 42.00 $ 3.50 $ 53.00 $ 5.30 $ 54.00 $ 8.00 All sales are made through the company's own retail outlets. The Racket Division has the following fixed costs Fixed production costs Advertising expense Administrative salaries Total Per Month $ 158,000 138,000 88, eee $ 384, eee Sales, in units, over the past two months have been as follows: April May Standard Deluxe 2, eee 1, eee 8,eee 1,eee Pro Total 5, eee 8, eee 3,800 12,000 Required: 1-a. Prepare contribution format income statements for April 1-5. Prepare contribution format income statements for May Total Standard Amount % $ 140,000 % Topper Sports, Inc. Income Statement for April Deluxe Amount % $ 106,000 % Pro Amount $ 800,000 Amount % % % $ 1,046,000 Sales Variable expenses Production Selling 60% 84,000 7,000 53,000 5,300 50 96 51% 320,000 40,000 401% 5% 457,000 52,300 43.7 5.0 5% % % % % 91,000 65% (65) % % 55 % (55) % 58,300 $ 47,700 48.79 360.000 440,000 % 45 % (45) % 509,300 536,700 $ 49,000 $ $ (48.7) Total variable expenses Contribution margin Fixed expenses Production Advertising Administrativo 158,000 138,000 88,000 Production Selling 84.000 7,000 60% 5% 94 53,000 5,300 320,000 40,000 40% 51% % 457,000 52 300 50% 5% % % 437 5.0 45 % 48.7 % 65 % (65) 91.000 49,000 58,300 $ 47.700 55 % (55) 360,000 440,000 509,300 536,700 $ $ (45) % $ (48.7) Total variable expenses Contribution margin Fixed expenses Production Advertising Administrativo 158,000 138,000 88,000 Total foxed expenses Net operating income 384,000 152.700 $ Pro Total Standard Amount 5 Topper Sports, Inc. Income Statement for May Deluxe Amount % % $ 106,000 % Amount % Amount % $ 560,000 $ 480,000 % S 1.146,000 'Sales Variable expenses 50.7 Production Selling 336,000 28,000 60% 5% 53,000 5,300 50% 5% % 192,000 24,000 40% 5% 581,000 57,300 5.0 % % % % 638,300 364,000 196,000 65% 58,300 (65) % $ 47,700 55 % (55) % 216,000 264.000 45% (45) % $ 55.7 (557) $ $ 507 700 Total variable expenses Contribution margin Fixed expenses Production Advertising Administrative 158,000 138,000 88,000 Variable expenses Production Selling 336,000 28.000 60% % 53,000 5,300 50% 5% 192.000 24.000 401% 51% 581,000 57 300 50.71 5.0 % %6 36 638,300 384.000 195,000 55.7 65% 58,300 (85) % $ 47,700 % 45 % (45) % 55 % (55) 216.000 264.000 $ $ $ 507 700 (55.7) Total variable expenses Contribution margin Fixed expenses Production Advertising Administrativo 158,000 138,000 88.000 Total faced expenses 384,000 123.700 $
