Variable Costing Income Statement for a Service Company

The actual and planned data for Broadwater Institute & Technical School for the Fall term were as follows:

Line Item Description	Actual	Planned
Enrollment	5,000	4,500
Tuition per credit hour	$115	$100
Credit hours	80,000	72,000
Registration, records, and marketing costs per enrolled student	$300	$300
Instructional costs per credit hour	$45	$40
Depreciation on classrooms and equipment	$1,875,000	$1,875,000

Registration, records, and marketing costs vary by the number of enrolled students, while instructional costs vary by the number of credit hours. Depreciation is a fixed cost.

Prepare a variable costing income statement showing the contribution margin and operating income for the Fall term.

Line Item Description	Amount
Revenue	$9200000
Variable costs:
Registration, records, and marketing costs	$1350000 IS INCORRECT
Instructional costs	$3600000
Total variable costs	$4950000 IS INCORRECT
Contribution margin	$4250000 IS INCORRECT
Depreciation on classrooms and equipment	$1875000
Operating income	$2375000 IS INCORRECT

Variable Costing Income Statement for a Service Company The actual and planned data for Broadwater Institute \& Technical School for the Fall term were as follows: Registration, records, and marketing costs vary by the number of enrolled students, while instructional costs vary by the number of credit hours. Depreciation is a fixed cost. Prepare a variable costing income statement showing the contribution margin and operating income for the Fall term. Festhack Check My Wark Calculate: Revenue =$115 Credit hours Variable costs: Registration, records, and marketing costs =$300 Students Instructional costs =$45 Credit hours Revenue - Variable costs = Contribution margin - Depreciation = Operating income