A manufacturer's contribution margin income statement for the year follows. Prepare contribution margin income statements for each of the three separate cases below. Contribution Margin Income Statement Sales (12,500 units x $12 per unit) Variable costs (12,500 units x $7 per unit) Contribution margin (12,500 units x $5 per unit Fixed costs Income 1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by $5,800. 2. Unit selling price decreases by 4% and units produced and sold increase by 8%. Hint: A unit increase has both a sales and costs impact. 3. Fixed costs increase by $20,800, variable costs per unit decrease by $2, and units produced and sold increase by 400. $ 150,000 87,500 62,500 49,000 $ 13,500 1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by $5,800. Contribution Margin Income Statement Sales Variable costs Contribution margin Fixed costs Income (loss) Sales Variable costs Contribution margin Fixed costs $ $ 2. Unit selling price decreases by 4% and units produced and sold increase by 8%. Contribution Margin Income Statement $ 156,000 91,000 65,000 54,800 10,200 135,000 135,000
A manufacturer's contribution margin income statement for the year follows. Prepare contribution margin income statements for each of the three separate cases below. Contribution Margin Income Statement Sales (12,500 units x $12 per unit) Variable costs (12,500 units x $7 per unit) Contribution margin (12,500 units x $5 per unit Fixed costs Income 1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by $5,800. 2. Unit selling price decreases by 4% and units produced and sold increase by 8%. Hint: A unit increase has both a sales and costs impact. 3. Fixed costs increase by $20,800, variable costs per unit decrease by $2, and units produced and sold increase by 400. $ 150,000 87,500 62,500 49,000 $ 13,500 1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by $5,800. Contribution Margin Income Statement Sales Variable costs Contribution margin Fixed costs Income (loss) Sales Variable costs Contribution margin Fixed costs $ $ 2. Unit selling price decreases by 4% and units produced and sold increase by 8%. Contribution Margin Income Statement $ 156,000 91,000 65,000 54,800 10,200 135,000 135,000
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter3: Cost Behavior And Cost Forecasting
Section: Chapter Questions
Problem 54E: Income Statements under Absorption and Variable Costing In the coming year, Kalling Company expects...
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Question
![Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
Contribution Margin Income Statement
2. Unit selling price decreases by 4% and units produced and sold increase by 8%.
Contribution Margin Income Statement
$
Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
$
$
3. Fixed costs increase by $20,800, variable costs per unit decrease by $2, and units
produced and sold increase by 400.
Contribution Margin Income Statement
$
156,000
91,000
65,000
54,800
10,200
135,000
135,000
135,000
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F18997293-4de7-4aae-b470-1f23fe78308f%2F8752061a-b0e4-40ef-a1b1-0a10cbee5f6e%2Feig8l9_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
Contribution Margin Income Statement
2. Unit selling price decreases by 4% and units produced and sold increase by 8%.
Contribution Margin Income Statement
$
Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
$
$
3. Fixed costs increase by $20,800, variable costs per unit decrease by $2, and units
produced and sold increase by 400.
Contribution Margin Income Statement
$
156,000
91,000
65,000
54,800
10,200
135,000
135,000
135,000
0
![A manufacturer's contribution margin income statement for the year follows. Prepare contribution margin income statements
for each of the three separate cases below.
Contribution Margin Income Statement
Sales (12,500 units x $12 per unit)
Variable costs (12,500 units x $7 per unit)
Contribution margin (12,500 units x $5 per unit
Fixed costs
Income
1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by $5,800.
2. Unit selling price decreases by 4% and units produced and sold increase by 8%. Hint: A unit increase has both a sales and
costs impact.
3. Fixed costs increase by $20,800, variable costs per unit decrease by $2, and units produced and sold increase by 400.
$ 150,000
87,500
62,500
49,000
$ 13,500
1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by
$5,800.
Contribution Margin Income Statement
Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
Sales
Variable costs
Contribution margin
Fixed costs
$
$
2. Unit selling price decreases by 4% and units produced and sold increase by 8%.
Contribution Margin Income Statement
$
156,000
91,000
65,000
54,800
10,200
135,000
135,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F18997293-4de7-4aae-b470-1f23fe78308f%2F8752061a-b0e4-40ef-a1b1-0a10cbee5f6e%2Flk4pwcl_processed.jpeg&w=3840&q=75)
Transcribed Image Text:A manufacturer's contribution margin income statement for the year follows. Prepare contribution margin income statements
for each of the three separate cases below.
Contribution Margin Income Statement
Sales (12,500 units x $12 per unit)
Variable costs (12,500 units x $7 per unit)
Contribution margin (12,500 units x $5 per unit
Fixed costs
Income
1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by $5,800.
2. Unit selling price decreases by 4% and units produced and sold increase by 8%. Hint: A unit increase has both a sales and
costs impact.
3. Fixed costs increase by $20,800, variable costs per unit decrease by $2, and units produced and sold increase by 400.
$ 150,000
87,500
62,500
49,000
$ 13,500
1. The 12,500 units produced and sold increases to 13,000 units and fixed costs increase by
$5,800.
Contribution Margin Income Statement
Sales
Variable costs
Contribution margin
Fixed costs
Income (loss)
Sales
Variable costs
Contribution margin
Fixed costs
$
$
2. Unit selling price decreases by 4% and units produced and sold increase by 8%.
Contribution Margin Income Statement
$
156,000
91,000
65,000
54,800
10,200
135,000
135,000
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VIEWStep 3: Calculate the Contribution Margin Income Statement for Situation 2
VIEWStep 4: Calculate the Contribution Margin Income Statement for Situation 3
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