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Milden Company is a merchandiser that plans to sell 37,000 units during the next quarter at a selling price of $55 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost Formula Cost of goods sold $27 per unit sold Advertising expense $184,000 per quarter Sales commissions 5% of sales Shipping expense $24,000 per quarter + $5.00 per unit sold Administrative salaries $94,000 per quarter Insurance expense $10, 400 per quarter Depreciation expense $64,000 per quarter Required: Prepare a contribution format income statement for the next quarter. Prepare a traditional format income statement for the next quarter.

Milden Company is a merchandiser that plans to sell 37,000 units during the next quarter at a selling price of $55 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost Formula Cost of goods sold $27 per unit sold Advertising expense $184,000 per quarter Sales commissions 5% of sales Shipping expense $24,000 per quarter + $5.00 per unit sold Administrative salaries $94,000 per quarter Insurance expense $10, 400 per quarter Depreciation expense $64,000 per quarter Required: Prepare a contribution format income statement for the next quarter. Prepare a traditional format income statement for the next quarter.

FINANCIAL ACCOUNTING
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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Milden Company is a merchandiser that plans to sell 37,000 units during the next quarter at a selling price of $55 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost Formula Cost of goods sold $27 per unit sold Advertising expense $184,000 per quarter Sales commissions 5% of sales Shipping expense $24,000 per quarter + $5.00 per unit sold Administrative salaries $94,000 per quarter Insurance expense $10, 400 per quarter Depreciation expense $64,000 per quarter Required: Prepare a contribution format income statement for the next quarter. Prepare a traditional format income statement for the next quarter.
Transcribed Image Text:Milden Company is a merchandiser that plans to sell 37,000 units during the next quarter at a selling price of $55 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost Formula Cost of goods sold $27 per unit sold Advertising expense $184,000 per quarter Sales commissions 5% of sales Shipping expense $24,000 per quarter + $5.00 per unit sold Administrative salaries $94,000 per quarter Insurance expense $10, 400 per quarter Depreciation expense $64,000 per quarter Required: Prepare a contribution format income statement for the next quarter. Prepare a traditional format income statement for the next quarter.
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