Royal Lawncare Company produces and sells two packaged products-Weedban and Gree

Question

Royal Lawncare Company produces and sells two packaged products-Weedban and Greengrow. Revenue and cost information relating to the products follow Product Selling price per unit Variable expenses per unit Traceable fixed expenses per year Weedban Greengr ow $11.00 35.00 $2. 70 11.00 $130, 000 43, 000 Common fixed expenses in the company total $113,000 annually. Last year the company produced and sold 41,500 units of Weedban and 25,000 units of Greengrow Required Prepare a contribution format income statement segmented by product lines. Product Line Total Company Weedban Greengrow

Explanation / Answer

Total Weedban Greengrow Sales 1331500 456500 875000 Variable expenses 387050 112050 275000 Contribution margin 944450 344450 600000 Traceable fixed expenses 173000 130000 43000 Product line segment margin 771450 214450 557000 Common fixed expenses not traceable to products 113000 Net operating income 658450

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