Cherokee Incorporated is a merchandiser that provided the following information: Amount Number of units sold 11,000 Selling price per unit $ 18 Variable selling expense per unit $ 1 Variable administrative expense per unit $ 1 Total fixed selling expense $ 21,000 Total fixed administrative expense $ 14,000 Beginning merchandise inventory $ 9,000 Ending merchandise inventory $ 25,000 Merchandise purchases $ 86,000 Required: Prepare a traditional income statement. Prepare a contribution format income statement.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter6: Merchandising Transactions
Section: Chapter Questions
Problem 22Q: The following is select account information for August Sundries. Sales: $850,360; Sales Returns and...
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Cherokee Incorporated is a merchandiser that provided the following information: Amount Number of units
sold 11,000 Selling price per unit $ 18 Variable selling expense per unit $ 1 Variable administrative expense
per unit $ 1 Total fixed selling expense $ 21,000 Total fixed administrative expense $ 14,000 Beginning
merchandise inventory $ 9,000 Ending merchandise inventory $ 25,000 Merchandise purchases $ 86,000
Required: Prepare a traditional income statement. Prepare a contribution format income statement.
Transcribed Image Text:Cherokee Incorporated is a merchandiser that provided the following information: Amount Number of units sold 11,000 Selling price per unit $ 18 Variable selling expense per unit $ 1 Variable administrative expense per unit $ 1 Total fixed selling expense $ 21,000 Total fixed administrative expense $ 14,000 Beginning merchandise inventory $ 9,000 Ending merchandise inventory $ 25,000 Merchandise purchases $ 86,000 Required: Prepare a traditional income statement. Prepare a contribution format income statement.
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