70.2K

Verified Solution

Link Copied!

Marwick's Pianos, Inc., purchases pianos from a large manufacturer for an average cost of $1,519 per unit and then sells them to retail customers for an average price of $2,100 each. The company's selling and administrative costs for a typical month are presented below: Cost Formula Costs Selling: Advertising Sales salaries and commissions Delivery of pianos to customers Utilities Depreciation of sales facilities Administrative: Executive salaries Insurance Clerical Depreciation of office equipment $949 per month $4,804 per month, plus 6% of sales $60 per piano sold $668 per month $5,061 per month $13,583 per month $712 per month $2,531 per month, plus $36 per piano sold $903 per month During August, Marwick's Pianos, Inc., sold and delivered 59 pianos. Required: 1. Prepare a traditional format income statement for August. 2. Prepare a contribution format income statement for August. Show costs and revenues on both a total and a per unit basis down through contribution margin. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a traditional format income statement for August. (A "Net operating loss" should be entered as a negative number.) Marwick's Pianos, Inc. Traditional Income Statement For the Month of August Selling and administrative expenses: Selling expenses: 0 Total selling expenses Administrative expenses: 0 Total administrative expenses Total selling and administrative expenses 0 Required 1 Required 2 Prepare a contribution format income statement for August. Show costs and revenues on both a total and a per unit basis down through contribution margin. (A "Net operating loss" should be entered as a negative number.) Marwick's Pianos, Inc. Contribution Format Income Statement For the Month of August Total Per Piano Variable expenses 0 0 Total variable expenses Contribution margin Fixed expenses: Total fixed expenses 0

Answer & Explanation Solved by verified expert

See Answer