Cosgrove Company, Inc. is a wholesaler that distributes a single product. The company's revenues and expenses for the last three months are given below: Identify the fixed and variable costs associated with Cosgrove. Calculate the average costs per month.Cosgrove CompanyTraditional Format Income StatementFor the Three Months Ended June 30 AprilMayJuneSales in Units3,0003,7504,500 Sales Revenue420,000525,000630,000Cost of Goods Sold168,000210,000252,000Gross Margin252,000315,000378,000Selling and Administrative Expenses: Shipping Expense44,00050,00056,000 Advertising Expense70,00070,00070,000 Salaries and Commissions107,000125,000143,000 Insurance Expense9,0009,0009,000 Depreciation Expense42,00042,00042,000Total Selling and Administrative Expenses272,000296,000320,000Net Operating Income (Loss)$(20,000)$19,000$58,000

Cost can be divided in Fixed & Variable. Fixed Cost is the cost that remains same irrespective…

Answered: Cosgrove Company, Inc. is a wholesaler…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

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Cosgrove Company, Inc. is a wholesaler that distributes a single product. The company's revenues and expenses for the last three months are given below:

Identify the fixed and variable costs associated with Cosgrove.
Calculate the average costs per month.

Cosgrove Company Traditional Format Income Statement For the Three Months Ended June 30
	April	May	June
Sales in Units	3,000	3,750	4,500

Sales Revenue	420,000	525,000	630,000
Cost of Goods Sold	168,000	210,000	252,000
Gross Margin	252,000	315,000	378,000
Selling and Administrative Expenses:
Shipping Expense	44,000	50,000	56,000
Advertising Expense	70,000	70,000	70,000
Salaries and Commissions	107,000	125,000	143,000
Insurance Expense	9,000	9,000	9,000
Depreciation Expense	42,000	42,000	42,000
Total Selling and Administrative Expenses	272,000	296,000	320,000
Net Operating Income (Loss)	$(20,000)	$19,000	$58,000

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