Chapter 1 Homework-P x CO Not secure | ezto.mheducation.com/hm.tpx value: 0.71 p

Question

Chapter 1 Homework-P x CO Not secure | ezto.mheducation.com/hm.tpx value: 0.71 polnts Exercise 1-13 Traditional and Contrlbution Format Income Statements [LO1-6] The Alpine House, Inc, is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31: Amount $150,000 $ 750 $50 Variable administrative expense per pair of skis $10 $ 20,000 $ 20,000 $ 30,000 $ 40,000 $100,000 Total sales revenue Selling price per pair of skis Variable selling expense per pair of skis Total fixed selling expense Total fixed administrative expense Beginning merchandise inventory Ending merchandise inventory Merchandise purchases Required 1 Prepare a traditional income statement for the quarter ended March 31 The Alpine House, Inc. Traditional Income Statement $150,000 Sales Cost of goods sold Gross margin 60,000 Seling and administrative expenses Selling expenses Administrative expenses 30.000 22.000

Explanation / Answer

number of units sold = 150,000/750 200 units 1) Traditional income statement Sales 150,000 cost of goods sold (30,000+100,000-40,000) 90000 Gross profit 60,000 Selling and administrative expense Selling expense (20,000 +200*50) 30,000 Administrative exp (20,000+200*10) 22,000 52,000 Net operating income 8,000 2) Contribution Format income statement Sales 150,000 Variable expenses cost of goods sold 90,000 selling expense 10,000 Administrativ expense 2,000 102,000 Contribution margin 48,000 fixed expenses: Selling expenses 20,000 Administrative expense 20,000 40,000 Net operating income 8,000 3) contribution of each pair of skis was 240 (48000/200)

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