Milden Company is a merchandiser that plans to sell 41,000 units during the next quarter at a selling price of $59 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost of good sold Advertising expense Sales commissions Shipping expense Administrative salaries Insurance expense Depreciation expense Cost Formula $30 per unit sold $186,000 per quarter 5% of sales $16,000 per quarter + $5.00 per unit sold $96,000 per quarter $10,600 per quarter $66,000 per quarter Required: 1. Prepare a contribution format income statement for the next quarter. 2. Prepare a traditional format income statement for the next quarter.
Milden Company is a merchandiser that plans to sell 41,000 units during the next quarter at a selling price of $59 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost of good sold Advertising expense Sales commissions Shipping expense Administrative salaries Insurance expense Depreciation expense Cost Formula $30 per unit sold $186,000 per quarter 5% of sales $16,000 per quarter + $5.00 per unit sold $96,000 per quarter $10,600 per quarter $66,000 per quarter Required: 1. Prepare a contribution format income statement for the next quarter. 2. Prepare a traditional format income statement for the next quarter.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Vikrambhai
Transcribed Image Text:Milden Company is a merchandiser that plans to sell 41,000 units during the next quarter at a selling price of $59 per unit. The
company also gathered the following cost estimates for the next quarter:
Cost
Cost of good sold
Advertising expense
Sales commissions
Shipping expense
Administrative salaries
Insurance expense
Depreciation expense
Cost Formula
$30 per unit sold
$186,000 per quarter
5% of sales
$16,000 per quarter + $ 5.00 per unit sold
$96,000 per quarter
$10,600 per quarter
$66,000 per quarter
Required:
1. Prepare a contribution format income statement for the next quarter.
2. Prepare a traditional format income statement for the next quarter.
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