Suppose Revenues are $535,024 Cost of Goods sold, representing the cost of products sold, is made...
Suppose Revenues are $535,024
Cost of Goods sold, representing the cost of products sold, is made up of $60,897 of fixed costs and $84,201 of variable costs.
Period expenses (sales, marketing and administrative expenses) are made up of $30000 of variable costs and $50000 in fixed costs.
Prepare a contribution margin income statement. What is Total Contribution Margin that would appear on the statement?
Homework Answers
The contribution margin income statement will be prepared as follows:
| Contribution Margin Income Statement | ||
| Sales revenue | 535024 | |
| Variable costs: | ||
| Cost of goods sold | 84201 | |
| Sales, marketing, and administrative expenses | 30000 | |
| Total variable expenses | 114201 | |
| Contribution margin | 420823 | |
| Fixed costs: | ||
| Cost of goods sold | 60897 | |
| Sales, marketing, and administrative expenses | 50000 | |
| Total fixed costs | 110897 | |
| Net operating income | 309926 | |
Total contribution margin that would appear on the income statement is $420,823.
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Suppose Revenues are $535,024
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Problem 11-2 Bramble Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold...
Problem 11-2
Bramble Company bottles and distributes B-Lite, a diet soft drink.
The beverage is sold for 50 cents per 16-ounce bottle to retailers,
who charge customers 75 cents per bottle. For the year 2017,
management estimates the following revenues and costs.
Sales
$1,840,000
Selling expenses—variable
$60,000
Direct materials
390,000
Selling expenses—fixed
55,000
Direct labor
320,000
Administrative expenses—variable
34,000
Manufacturing overhead—variable
300,000
Administrative expenses—fixed
46,000
Manufacturing overhead—fixed
417,000
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estimates.
BRAMBLE...
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Problem 11-2
Bramble Company bottles and distributes B-Lite, a diet soft drink.
The beverage is sold for 50 cents per 16-ounce bottle to retailers,
who charge customers 75 cents per bottle. For the year 2017,
management estimates the following revenues and costs.
Sales
$1,840,000
Selling expenses—variable
$60,000
Direct materials
390,000
Selling expenses—fixed
55,000
Direct labor
320,000
Administrative expenses—variable
34,000
Manufacturing overhead—variable
300,000
Administrative expenses—fixed
46,000
Manufacturing overhead—fixed
417,000
Prepare a CVP income statement for 2017 based on management’s
estimates.
BRAMBLE...
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