Question

Saved Help Save & Exit Sub Check my work Exercise 19-8 Contribution margin format income statement LO P2 Polarix is a retailer of ATVs (all-terrain vehicles) and accessories. An income statement for its Consumer ATV Department for the current year follows. ATVs sell for $3,800 each. Variable selling expenses are $270 per ATV. The remaining selling expenses are fixed. Administrative expenses are 40% variable and 60% fixed. The company does not manufacture its own ATVs; it purchases them from a supplier for $1,830 each POLARIX Income Statement Consumer ATV Department For Year Ended December 31, 2017 Sales $646,000 Cost of goods sold 311,100 Gross margin 334,900 Operating expenses Selling expenses $135,000 Administrative expenses 59,500 194,500 Net income $140,400 Required: 1. Prepare an income statement for this current year using the contribution margin format (Do not round intermediate calculations. Round contribution margin per ATV value to the nearest whole number.) POLARIX Income Statement Consumer ATV Department For Year Ended December 31, 2017 < Prey 5 of 13 18 Next >

Answer 1

Contribution Margin Income Statement In come skybement is helpful in calylating of the financial result of the entity's operations for the porttulau period. Financial Rereſt of the operations is in the form of the income f loss earned / incurred by the organisation Income I lost is calulghel by Total Revenue less Total costs. Costs many be variable or fixed in nature variable costs changer as level of activity changes where fixel costs remain fiseta ' conly byton Margla Igume Statement is the formate of Calellahing profit ie income / loss. In this format, total zeveques que deducted by Variable costs to arrive contribution morgia and contributen margin is deducted by the fixed costs to anive inome,