Question

Amount $ 1,302,000 420 45 Sales Selling price per pair of skis Variable selling expense per pair of ski Variable administrative expense per pair of skis Total fixed selling expense Total fixed administrative expense Beginning merchandise inventory Ending merchandise inventory Merchandise purchases 19 $ $ 135,000 105,000 70,000 110,000 290,000 $ $ 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 3. What was the contribution margin per unit? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a traditional income statement for the quarter ended March 31. The Alpine House, Inc. Traditional Income Statement Sales Cost of goods sold Selling and administrative expenses: Q Q 0 cod

Answer 1

Solution 1:

Units sold = $1302000/ 420 = 3100 units

Alpine House, Inc.
Traditional format Income Statement
Sales		$13,02,000
Less: Cost Of Goods sold:
Beginning Merchandise inventory	$70,000
Add: Merchandise purchases	$2,90,000
Merchandise available for sale	$3,60,000
Less: Ending merchandise Inventory	$1,10,000
Cost of Goods sold		$2,50,000
Gross Profit		$10,52,000
Less: Selling and Administrative Expenses:
Variable Selling Expenses (3100*45)	$1,39,500
Variable Administrative Expenses (3100*19)	$58,900
Fixed Selling Expenses	$1,35,000
Fixed Administrative Expenses	$1,05,000
Total expenses		$4,38,400
Net Operating Income		$6,13,600

Solution 2:

Alpine House, Inc.
Contribution format Income Statement
Sales		$13,02,000
Variable Expenses:
Coat of goods sold ($70000+$290000 - $110000)	$2,50,000
Variable Selling Expenses (3100*45)	$1,39,500
Variable Administrative Expenses (3100*19)	$58,900
Total Variable Expenses		$4,48,400
Contribution Margin		$8,53,600
Fixed Expenses:
Fixed Selling Expenses	$1,35,000
Fixed Administrative Expenses	$1,05,000
Total Fixed Expenses		$2,40,000
Net Operating Income		$6,13,600

Solution 3:

Contribution margin per unit = $853600/ 3100 = $275.35