Marano Corporation produces and sells a single product. In October, the company
ID: 2430656 • Letter: M
Question
Marano Corporation produces and sells a single product. In October, the company sold 2,500 units. Its total sales were $149,000, its total variable expenses were $79,500, and its total fixed expenses were $56,400.
Construct the company's contribution format income statement for October. (Do not round intermediate calculations.)
Redo the company's contribution format income statement assuming that the company sells 2,400 units.(Do not round intermediate calculations.)
Marano Corporation produces and sells a single product. In October, the company sold 2,500 units. Its total sales were $149,000, its total variable expenses were $79,500, and its total fixed expenses were $56,400.
Explanation / Answer
Answer:
(1)
Construct the company's contribution format income statement for October
Contribution format statement (2500 units)
Particular
Amount $
Sales
149000
less:
Variable Cost
79500
Contribution margin
69500
Less:
fixed Expenses
56400
Net Operating Income
13100
________________________________________
(2)
Redo the company's contribution format income statement assuming that the company sells 2,400 units
Contribution format statement (2400 units)
Particular
Amount $
Sales (149000*2400/2500)
143040
less:
Variable Cost (79500*2400/2500)
76320
Contribution margin
66720
Less:
fixed Expenses
56400
Net Operating Income
10320
Contribution format statement (2500 units)
Particular
Amount $
Sales
149000
less:
Variable Cost
79500
Contribution margin
69500
Less:
fixed Expenses
56400
Net Operating Income
13100