? # senare : https:/ lowlconnecthtml Chapter 1 1 company is a merchandiser that

Question

? # senare : https:/ lowlconnecthtml Chapter 1 1 company is a merchandiser that reported he folwing normation based on 000 umns uk Eeginning menchandise Srventery Ending merchandise inventory 5 12, Required 1. Prepare a contribution format income statement 2. Prepare a traditional format income statement 3. Calculate the selling prike per unt 4 Calculate the variable cost per unit. 5. Calculate the contribution margin per unt 6. Which income statement format (tracditional 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? Complete this question by entering your answwers in the tabs below Req 1 Req 2 Req 3 to 5 Req 6 Prepare a contribution format income statement Prey 1of2? Next > O lype here to search

Explanation / Answer

1)  

particulars $

sales 300,000

  

less variable cost

purchase (200,000)

variable selling cost (15,000)

variable administration cost (bf) (25,000)

-------------

contribution margin 60,000

less fixed cost

fixed selling expense (bF) (30,000)

fixed administrative expense (12,000)

----------------

net operating income 18,0000

-------------

  

note;

variable administarive cost = 300,000-(60,000+15,000+200,000) =25,000

fixed selling expense = 30,000 (60,000-(18,000+12,00)

2) sales 300,000

less cost of goods sold

purchase 200,000

opening inventory 20,000

- closing inventory (7,000)

----------

(213,000)

-------------

gross margin 87,0000

less selling and administartion

variable (15,000+25,000) ( 37,0000)

fixed (30,000+ 12,000) ( 42,000)

------------------

8,0000

-------------------

3) selling price per unit = $300 / per unit ($ 300,000/1000)

4) variable cost per unit = $ 250 per unit

($213,000 +12,000+25,0000 /(10000 units))

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