The Alpine House, Inc., is a large retailer of snow skis. The company assembled

Question

The Alpine House, Inc., is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31:

Required:

1. Prepare a traditional income statement for the quarter ended March 31.

2. Prepare a contribution format income statement for the quarter ended March 31.

3. What was the contribution margin per unit?

Amount Sales $ 1,188,000 Selling price per pair of skis $ 440 Variable selling expense per pair of skis $ 47 Variable administrative expense per pair of skis $ 15 Total fixed selling expense $ 155,000 Total fixed administrative expense $ 100,000 Beginning merchandise inventory $ 75,000 Ending merchandise inventory $ 115,000 Merchandise purchases $ 305,000

Explanation / Answer

1. Prepare a traditional income statement for the quarter ended March 31.

2. Prepare a contribution format income statement for the quarter ended March 31.

3. Contribution margin per unit = 755600/2700 = 279.85 per unit

Sales 1188000 Cost of goods sold (265000) Gross profit 923000 Selling expenses (281900) Administrative expenses (140500) (422400) Net operating income 500600

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.