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Problem $1-21($Algo$)$ Traditional and Contribution Format Income Statements $[$LO$1-6]$ 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.

Note: A "Net operating loss" should be entered as a negative number.

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Marwick's Pianos, Incorporated, purchases pianos from a manufacturer for an average cost of $$1,506$ per unit and then sells them to

retail customers for an average price of $$3,500$ each. The company's selling and administrative costs for a typical month are presented

below:

Costs

Selling:

Advertising

Sales salaries and commissions

$$4,793$ per month, plus $4\%$ of sales

of pianos to customers $$62$ per piano sold

Utilities $$668$ per month

Depreciation of sales facilities $$4,990$ per month

Administrative:

Executive salaries $$13,473$ per month

Insurance $$704$ per month

Clerical $$2,451$ per month, plus $$38$ per piano sold

Depreciation of office equipment

Cost Formula

month

$$865$ per month

During August, Marwick's Pianos, Incorporated, sold and delivered $56$ pianos.

Required:

Prepare a traditional format income statement for August.

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.

Note: A "Net operating loss" should be entered as a negative number.

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