Mighty Bright Window Cleaners’ monthly income statement at several levels of act

Question

Mighty Bright Window Cleaners’ monthly income statement at several levels of activity is as follows:

Windows washed 2,500 4,800 6,700 Sales revenue $ 3,800 $ 7,296 $ 10,184 Cost of goods sold 1,400 2,688 3,752 Gross profit 2,400 4,608 6,432 Operating expenses    Advertising expense 400 400 400    Salaries and wages expense 750 980 1,170    Insurance expense 200 200 200    Postage expense 450 864 1,206 Total operating expense 1,800 2,444 2,976 Operating income $ 600 $ 2,164 $ 3,456 (b) Prepare a contribution margin income statement based on a volume of 4,150 windows. (Round unit cost to 2 decimal places, e.g. 12.25 and all other answers to 0 decimal places, e.g. 45,000.) 4,150 windows Per Unit

Explanation / Answer

b). Contribution Margin Income Statement :-

Particulars Amount($) Amount($) at 4150 Windows Amount($) Per Unit Sales Revenue 6308 1.52 Less : Variable Costs:- Cost of Goods sold 2324 0.56 Salaries 415 0.10 Postage 747 0.18 Total Variable Costs 3486 0.84 Contribution Margin 2822 0.68 Less : Fixed Costs Advertising 400 Salaries 500 Insurance 200 Total Fixed Costs 1100 Operating Income 1722

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