C What is the W D. What does the contribution margin contribute Vlial gelleraily

Question

C What is the W D. What does the contribution margin contribute Vlial gelleraily causes the difference between the income calculated under absorption costi versus income calculated under variable cost toward"? Aonly What You Have Learned L04: Prepare a Contribution Income Statement Fresh Baked Cookie Company sells cookies in a large shopping mall. The following multiple-step income statement was prepared for the year ending December 31, 2008. Fresh Baked Cookie Company Income Statement For the Year Ended December 31, 2008 Sales Cost of Goods Sold Gross Profit Operating Expense: Selling Expense Administrative Expense Operating Income $36,000 4,000 $32,000 $18,000 10,000 28,000 $ 4,000

Explanation / Answer

CONTRIBUTION INCOME STATEMENT

SALES $36600 LESS VARIABLE COST :- COST OF GOODS SOLD (4000) SELLING EXPENSES ($18000 *20%) (3600) ADMINISTRATIVE EXPENSES ($10000 * 5%) (500) CONTRIBUTION MARGIN $28500

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