Question

Please answer with the same format as given in the question

| The Alpine House, Inc., is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31: $ Amount 1,160,000 400 A A A 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 merchandise inventory Ending merchandise inventory Merchandise purchases A A 155,000 105,000 75,000 120,000 305,000 $ $ 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? 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 Selling and administrative expenses:

Answer 1

1. Preparing Traditional Income Statement:-

The Alpine House, Inc.

Traditional Income Statement

For the Quarter Ended March 31

Accounts	Amount	Amount
Sales	$1,160,000
Less:- Cost of Goods Sold	(260,000)
Gross Profit		$900,000
Selling and Administrative Expenses:-
Selling Expense	$285,500
Administrative Expense	157,200
Total Selling and Administrative Expenses		$(442,700)
Net Operating Income		$457,300

Working Notes:-

Total Units sold =(Sales/Selling Price per pair of skis)

=($1,160,000/$400)

=2,900 Pair of skis

Cost of Goods Sold={(Beginning Merchandise Inventory+Merchandise Purchases)- Ending Merchandise Inventory}

={($75,000+$305,000)-$120,000}

=($380,000-$120,000)

=$260,000

Selling Expense={(Variable Selling Expense per pair of skis × Pair of skis sold)+Total fixed selling Expense}

={($45× 2,900 Pair of skis)+$155,000}

=($130,500+$155,000)

=$285,500

Administrative Expense={(Variable administrative expense per pair of skis × pair of skis sold)+Total Fixed Administrative Expense)

={($18× 2,900 Pair of skis)+$105,000)

=($52,200+$105,000)

=$157,200

2. Preparing Contribution Income Statement:-

The Alpine House, Inc.

Contribution Income Statement

For the Quarter Ended March 31

Accounts	Amount	Amount
Sales		$1,160,000
Variable Expenses:-
Cost of Goods Sold	$260,000
Variable Selling Expense	130,500
Variable Administrative Expense	52,200
Total Variable Expenses		$(442,700)
Contribution Margin		$717,300
Fixed Expenses:-
Total Fixed selling Expense	$155,000
Total Fixed Administrative Expenses	105,000
Total Fixed Expenses		$(260,000)
Net Operating Income		$457,300

Working Notes:-

Variable Selling Expenses=(Variable Selling Expense per pair of skis × pair of skis sold)

=($45×2,900 Pair of skis)

=$130,500

Variable Administrative Expenses=( Variable Administrative Expense per pair of skis × Pair of skis sold)

=($18×2,900 Pair of skis)

=$52,200

3. Calculations for Contribution Margin per Unit:-

Contribution Margin per Unit=( Contribution Margin/Pair of skis sold)

=($717,300/2,900 Pair of skis)

=$247.34 or $247