1). Zen Company Income Statement For the month ended September 30, 2020 $750,000 Sales Cost of good sold Gross margin Selling and Administration expense: Selling expenses Administration expense (660,000) 90,000 20,000 10,000 (30,000) 60.000 Net operating income Zen company sell its shoes for $750 per pair. The variable expense to produce shoes is $350 per pair. The full admin cost is variable. In terms of selling expenses, the sales commission per pair is $ 5 and the remaining are the fixed salaries of sales people. Requirement a. Prepare a contribution format income statement. Find the contribution of each pair of shoes toward covering fixed cost.

1). Zen Company Income Statement For the month ended September 30, 2020 $750,000 Sales Cost of good sold Gross margin Selling and Administration expense: Selling expenses Administration expense (660,000) 90,000 20,000 10,000 (30,000) 60.000 Net operating income Zen company sell its shoes for $750 per pair. The variable expense to produce shoes is $350 per pair. The full admin cost is variable. In terms of selling expenses, the sales commission per pair is $ 5 and the remaining are the fixed salaries of sales people. Requirement a. Prepare a contribution format income statement. Find the contribution of each pair of shoes toward covering fixed cost.

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter18: Cost-volume-profit Analysis (cvp)

Section: Chapter Questions

Problem 1R: Poleski Manufacturing, which maintains the same level of inventory at the end of each year, provided...

See similar textbooks

Similar questions

Park and West, LLC, provides consulting services to retail merchandisers in the Midwest. In 2019, they generated $720,000 in service revenue. Their total cost (fixed and variable) per client was $2,500 and they served 115 clients during the year. If operating expenses for the year were $302,000 what was their net income?
Refer to RE22-2. Assume Heller Company had sales revenue of 510,000 in 2019 and 650,000 in 2020. Prepare Hellers partial income statements (through gross profit) for 2019 and 2020. RE22-2 Heller Company began operations in 2019 and used the LIFO method to compute its 300,000 cost of goods sold for that year. At the beginning of 2020, Heller changed to the FIFO method. Heller determined that its cost of goods sold under FIFO would have been 250,000 in 2019. For 2020, Hellers cost of goods sold under FIFO was 360,000, while it would have been 410,000 under LIFO. Heller is subject to a 21% income tax rate. Compute the cumulative effect of the retrospective adjustment on prior years income (net of taxes) that Heller would report on its retained earnings statement for 2020.
The following information is available for Cooke Company for the current year: The gross margin is 40% of net sales. What is the cost of goods available for sale? a. 5840,000 b. 960,000 c. 1,200,000 d. 1,220,000
Brandt Corporation had sales revenue of 500,000 for the current year. For the year, its cost of goods sold was 240,000, its operating expenses were 50,000, its interest revenue was 2,000, and its interest expense was 12,000. Brandts income tax rate is 30%. Prepare Brandts multiple-step income statement for the current year.
Ranger Industries has provided the following information at June 30: Other information: Average selling price, 196 Average purchase price per unit, 110 Desired ending inventory, 40% of next months unit sales Collections from customers: In month of sale20% In month after sale50% Two months after sale30% Projected cash payments: Inventory purchases are paid for in the month following acquisition. Variable cash expenses, other than inventory, are equal to 25% of each months sales and are paid in the month of sale. Fixed cash expenses are 40,000 per month and are paid in the month incurred. Depreciation on equipment is 2,000 per month. REQUIREMENT You have been asked to prepare a master budget for the upcoming quarter (July, August, and September). The components of this budget are a monthly sales budget, a monthly purchases budget, a monthly cash budget, a forecasted income statement for the quarter, and a forecasted September 30 balance sheet. The worksheet MASTER has been provided to assist you. Ranger Industries desires to maintain a minimum cash balance of 8,000 at the end of each month. If this goal cannot be met, the company borrows the exact amount needed to reach its goal. If the company has a cash balance greater than 8,000 and also has loans payable outstanding, the amount in excess of 8,000 is paid to the bank. Annual interest of 18% is paid on a monthly basis on the outstanding balance.
Poleski Manufacturing, which maintains the same level of inventory at the end of each year, provided the following information about expenses anticipated for next year: The selling price of Poleskis single product is 16. In recent years, profits have fallen and Poleskis management is now considering a number of alternatives. Poleski wants to have a net income next year of 250,000, but expects to sell only 120,000 units unless some changes are made. The president of Poleski has asked you to calculate the companys projected net income (assuming 120,000 units are sold) and the sales needed to achieve the companys net income objective for next year. Also, compute Poleskis contribution margin per unit, contribution margin ratio, and break-even point for next year. The worksheet CVP has been provided to assist you. Note that the data from the problem have already been entered into the Data Section of the worksheet.
Ivanhoe Inc. had sales of $2,300,000 for the first quarter of 2020. In making the sales, the company incurred the following costs and expenses. Variable Fixed Cost of goods sold $940,000 $464,000 Selling expenses 74,000 54,000 Administrative expenses 96,000 145,000 Prepare a CVP income statement for the quarter ended March 31, 2020. IVANHOE INC.CVP Income StatementFor the Quarter Ended March 31, 2020 Administrative ExpensesContribution MarginCost of Goods SoldFixed CostsGross ProfitNet Income/(Loss)SalesSelling ExpensesVariable Costs $ Administrative ExpensesContribution MarginCost of Goods SoldFixed CostsGross ProfitNet Income/(Loss)SalesSelling ExpensesVariable Costs Administrative ExpensesContribution MarginCost of Goods SoldFixed CostsGross…
Company X reports $200,000 in sales of Widgets in 2019. The Costs of Goods sold for these Widgets is $90,000. All other operating expenses (SG&A, R&D, Depreciation, Other, etc.) are $50,000. Which of the following is the correct representation of the profitability ratios: Gross Profit Margin 45%, Operating Margin 30%. Gross Profit Margin 55%, Operating Margin 30%. Gross Profit Margin 45%, Operating Margin 20%. Gross Profit Margin 55%, Operating Margin 20%.
At the end of 2020, ABC Company had the following balances: $300,000 was paid for the sold products. $50,000 was spent on advertising. 1,000,000 in net sales Utility costs are 10,000. Salary costs equal $50,000. Create the company's income statement.
Presented below are excerpts from the income statements of Ralos Company for the years ended December 31, 2021 and 2020.     2021     2020 Inc (Dec) Net sales P2,750,000 P2,500,000 P250,000 Cost of goods sold 1,584,000 1,600,000 (   16,000) Gross margin P1,166,000 P   900,000 P234,000 The unit cost decreased by 10% on January 1, 2021. What is increase (decrease) in cost of goods sold due to volume?
Presented below are excerpts from the income statements of Ralos Company for the years ended December 31, 2021 and 2020.     2021     2020 Inc (Dec) Net sales P2,750,000 P2,500,000 P250,000 Cost of goods sold 1,584,000 1,600,000 (   16,000) Gross margin P1,166,000 P   900,000 P234,000 The unit cost decreased by 10% on January 1, 2021. What is increase (decrease) in cost of goods sold due to volume? P(176,000) P(160,000) P 160,000
Presented below are excerpts from the income statements of Ralos Company for the years ended December 31, 2021 and 2020.     2021     2020 Inc (Dec) Net sales P2,750,000 P2,500,000 P250,000 Cost of goods sold 1,584,000 1,600,000 (   16,000) Gross margin P1,166,000 P   900,000 P234,000 The unit cost decreased by 10% on January 1, 2021. What is increase (decrease) in cost of goods sold due to volume? Group of answer choices P(160,000) P 176,000 P 160,000 P(176,000) pls answer fast