The Alpine House, Incorporated, is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31: Sales Selling price per pair of skis Variable selling expense per pair of skis Variable administrative expense per pair of skis Total fixed selling expense Total fixed administrative expense Beginning nerchandise inventory Ending merchandise inventory Merchandise purchases Amount $150,000 $750 $50 $10 $20,000 $ 20,000 $ 30,000 $40,000 $100,000 Required: 1. Prepare a traditional income statement for the quarter ended March 31 2. Prepare a contribution format income statement for the quarter ended March 31, 3. What was the contribution margin per unit?

The Alpine House, Incorporated, is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31: Sales Selling price per pair of skis Variable selling expense per pair of skis Variable administrative expense per pair of skis Total fixed selling expense Total fixed administrative expense Beginning nerchandise inventory Ending merchandise inventory Merchandise purchases Amount $150,000 $750 $50 $10 $20,000 $ 20,000 $ 30,000 $40,000 $100,000 Required: 1. Prepare a traditional income statement for the quarter ended March 31 2. Prepare a contribution format income statement for the quarter ended March 31, 3. What was the contribution margin per unit?

Financial & Managerial Accounting

13th Edition

ISBN:9781285866307

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter20: Variable Costing For Management Analysis

Section: Chapter Questions

Problem 20.10EX: Variable and absorption costingthree products Happy Feet Inc. manufactures and sells three types of...

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Exercise 1-15 (Algo) Traditional and Contribution Format Income Statements [LO1-6] The Alpine House, Incorporated, is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31: Amount Sales $ 1,462,000 Selling price per pair of skis $ 430 Variable selling expense per pair of skis $ 47 Variable administrative expense per pair of skis $ 20 Total fixed selling expense $ 135,000 Total fixed administrative expense $ 100,000 Beginning merchandise inventory $ 70,000 Ending merchandise inventory $ 110,000 Merchandise purchases $ 295,000 Required: 1. Prepare a traditional income statement for the quarter ended March 31. 2. Prepare a contribution format income statement for the quarter ended March 31. 3. What was the contribution margin per unit?
Exercise 1-6 Traditional and Contribution Format Income Statements [LO1-6] Cherokee Inc. is a merchandiser that provided the following information: Number of units sold 13,000 Selling price per unit $ 17 Variable selling expense per unit $ 2 Variable administrative expense per unit $ 2 Total fixed selling expense $ 20,000 Total fixed administrative expense $ 14,000 Beginning merchandise inventory $ 8,000 Ending merchandise inventory $ 22,000 Merchandise purchases $ 88,000 Required: 1. Prepare a traditional income statement. Cherokee, Inc. Traditional Income Statement Sales $221,000 Cost of goods sold 74,000 Gross margin 147,000 Selling and administrative expenses: Administrative expenses 40,000 Selling expenses 46,000 86,000 Net operating income $61,000 + 2. Prepare a contribution format income statement.…
Exercise 1-6 Traditional and Contribution Format Income Statements [LO1-6] Cherokee Inc. is a merchandiser that provided the following information: Amount Number of units sold 20,000 Selling price per unit $ 30 Variable selling expense per unit $ 4 Variable administrative expense per unit $ 2 Total fixed selling expense $ 40,000 Total fixed administrative expense $ 30,000 Beginning merchandise inventory $ 24,000 Ending merchandise inventory $ 44,000 Merchandise purchases $ 180,000 Required: 1. Prepare a traditional income statement. 2. Prepare a contribution format income statement.
iii) Determine the cost of direct material and salesman salary if the company produces *XX,XXX (80,000-90,000) bottles of drink. (CLO3, C3) iv) If production unit is *XXXXX (90,000 – 110,000): (CLO3, C3) a) Calculate total product cost b) Calculate total period cost v) Form cost function for: (CLO3, C3) a) Product cost b) Period cost
Subject: Business Economics QUESTION – 3The following data have been taken from the book of Ubaida Company Ltd. For the year 2002-03.Inventories July 1 June 30Raw Materials Rs. 36,000 Rs. 75,000Goods In Process 90,000 75,000Finished Goods 50,000 75,000 Data for the YearSales Rs. 960,000 Purchases ( Raw Materials ) Rs. 410,000Purchase discount 15,000 Direct Labour incurred 175,000Purchase Return 20,000 Transportation Inward 10,000Rent (Factory) 35,000 Fuel & Power 55,000Rent (Office) 3,000 Utility (Factory) 13,000Utility (Office) 1,500 Transportation Outward 15,000Factory Supervisor Salary 8,000 Depreciation ( Furniture) 10,000Depreciation( Machines) 20,000…
Question 3 A Lighting industry manufactures and sells a single product, heavy-duty battery operated standby lamp. The financial controller has prepared the following income statement for the most recent year: An Industry Income Statement under Absorption costing, for the year ended December 31. Sales Revenue RM2,450,000 Less: Cost of Goods Sold RM1,140,000 Gross Profit RM1,310,000 Less: Operating Expenses RM 750,000 Operating Income RM 560,000 The company produced 40,000 units and sold 30,000 units during the ear ending Dec 31. Fixed manufacturing overhead (MOH) for the year was RM320,000, while fixed operating expenses were RM450,000. Assume per unit cost of Direct Material and direct labor is RM15 and RM12 respectively. The company had no beginning inventory. Requirements Will the company’s operating income under variable costing be higher, lower or the same as operating income under absorption costing? Why? Project the company’s operating income…
14. Micky2, Inc. sells two products X and Y. Data concerning the company for July follow: Product X: sales - P200,000; variable expense - P50,000; and traceable fixed expenses - P80,000. For Product Y: sales - P300,000, variable expenses - P100,000 and traceable fixed expenses - P150,000. In addition there were common fixed expenses of P70,000 in July. What was the entire company's net income ? P50,000 P70,000 P150,000 P120,000
58 Charleston, Inc. had the following information: Year 2 Year 1 Net Sales 210,000 194,800 Cost of goods sold 128,000 140,600 Operating Expenses 34,400 23,000 Net Income 47,600 31,200 Using vertical analysis for Year 1, what is the percentage of cost of goods sold and operating expenses, respectively? Group of answer choices 11.8% and 27.8% 72.2% and 16.0% 16.0% and 11.8% 61.0% and 22.7% 61.0% and 16.4% 16.4% and 39.0% 72.2% and 11.8%
Restate the following income statement for a retailer in contribution format. Sales revenue ($100 per unit) $ 91,000 Less cost of goods sold ($58 per unit) 52,780 Gross margin 38,220 Less operating costs: Commissions expense ($7 per unit) $ 6,370 Salaries expense 7,800 Advertising expense 5,900 Shipping expense ($2 per unit) 1,820 21,890 Operating income $ 16,330 Per Unit select an income statement item $enter a dollar amount $enter a dollar amount select an opening name for section one : select an income statement item $enter a dollar amount enter a dollar amount select an income statement item…
Answer the following 2 questions based on the information in the spreadsheet you created below: Year 1 Year 2 Year 3 Year 4 $ % $ % $ % $ % Net Sales $ 500,000.00 100.00% $ 540,000.00 100.00% $ 577,800.00 100.00% $ 612,468.00 100.00% Cost of goods 265,000.00 53.00% $ 283,500.00 52.50% $ 300,456.00 52.00% $ 321,545.70 52.50% Gross Margin 235,000.00 47.00% $ 256,500.00 47.50% $ 277,344.00 48.00% $ 290,922.30 47.50% Operating expenses 210,000.00 42.00% $ 226,800.00 42.00% $ 245,565.00 42.50% $ 257,236.56 42.00% Operating proft 25,000.00 5.00% $ 29,700.00 5.50% $ 31,779.00 5.50% $ 33,685.74 5.50% 1. What can Mr. Ptolemy do to achieve the gross margin percentage goal set for the third and fourth years? Hint: What factors and elements of a P & L statement affect gross margin %?(List at least 2 things) 2. What efforts should Mr. Ptolemy make in the third and…
please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image) Joyner Company’s income statement for Year 2 follows: Sales $ 920,000 Cost of goods sold 506,000 Gross margin 414,000 Selling and administrative expenses 328,000 Net operating income 86,000 Nonoperating items: Gain on sale of equipment 7,000 Income before taxes 93,000 Income taxes 27,900 Net income $ 65,100 Its balance sheet amounts at the end of Years 1 and 2 are as follows: Year 2 Year 1 Assets Cash $ -25,900 $ -7,700 Accounts receivable 248,000 168,000 Inventory 314,000 264,000 Prepaid expenses 7,000 14,000 Total current assets 543,100 438,300 Property, plant, and equipment 500,000 401,000 Less accumulated depreciation 125,000 120,300 Net property, plant, and equipment 375,000 280,700 Loan to Hymans Company…
Variable and absorption costingthree products Happy Feet Inc. manufactures and sells three types of shoes. The income statements prepared under the-absorption costing method for the three shoes are-as follows: Happy Feet Inc. Product Income StatementsAbsorption Costing For the Year Ended December 31, 2016 Cross Training Shoes Golf Shoes Running Shoes Revenues 800,000 690,000 625,000 Cost of goods sold 416,000 338,100 418,750 Gross profit 384,000 351,900 206,250 Selling and administrative expenses 336,000 248,400 350,000 Income from operations 48,000 103,500 (143,750) In addition, you have determined the following information with respect to allocated fixed costs: Cross Training Shoes Golf Shoes Running Shoes Fixed costs: Cost of goods sold 128,000 9,700 118,750 Selling and administrative expenses 96,000 82.800 118,750 These fixed costs are used to support all three product lines. In addition, you have determined that the inventory is negligible. The management of the company has deemed the profit performance of the running shoe line as unacceptable. As a result, it has decided to eliminate the running shoe line. Management does not expect to be able to increase sales in the other two lines. However, as a result of eliminating the running shoe line, management expects the- profits of the company to increase by 143,750. a. Do you agree with managements decision and conclusions? b. Prepare a variable costing income statement for the three products. c. Use the report in (b) to determine the profit impact of eliminating the running shoe line, assuming no other changes.