AJ Manufacturing Company incurred $55,000 of fixed product cost and $44,000 of variable product cost during its first year of operation. Also during its first year, AJ incurred $17,500 of fixed and $14,000 of variable selling and administrative costs. The company sold all of the units it produced for $180,000. Required a. Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). b. Prepare an income statement using the contribution margin approach.

AJ Manufacturing Company incurred $55,000 of fixed product cost and $44,000 of variable product cost during its first year of operation. Also during its first year, AJ incurred $17,500 of fixed and $14,000 of variable selling and administrative costs. The company sold all of the units it produced for $180,000. Required a. Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). b. Prepare an income statement using the contribution margin approach.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Subject :- Accounting
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