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Pamela's Quilt Shoppe sells homemade Amish quilts. Pamela buys the quilts from local Amish artisans for $250 each, and her shop sells them for $400 each. She also pays a sales commission of 4% of sales revenue to her sales staff. Pamela leases her country-style shop for $1,700 per month and pays $1,300 per month in payroll costs in addition to the sales commissions. Pamela sold 100 quilts in February. Prepare Pamela's traditional income statement and contribution margin income statement for the month. Prepare the traditional income statement for the month.

Pamela's Quilt Shoppe sells homemade Amish quilts. Pamela buys the quilts from local Amish artisans for $250 each, and her shop sells them for $400 each. She also pays a sales commission of 4% of sales revenue to her sales staff. Pamela leases her country-style shop for $1,700 per month and pays $1,300 per month in payroll costs in addition to the sales commissions. Pamela sold 100 quilts in February. Prepare Pamela's traditional income statement and contribution margin income statement for the month. Prepare the traditional income statement for the month.

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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Pamela's Quilt Shoppe sells homemade Amish quilts. Pamela buys the quilts from local Amish artisans for $250 each, and her shop sells them for $400 each. She also pays a sales commission of 4% of sales revenue to her sales staff. Pamela leases her country-style shop for $1,700 per month and pays $1,300 per month in payroll costs in addition to the sales commissions. Pamela sold 100 quilts in February. Prepare Pamela's traditional income statement and contribution margin income statement for the month. Prepare the traditional income statement for the month.
Transcribed Image Text:Pamela's Quilt Shoppe sells homemade Amish quilts. Pamela buys the quilts from local Amish artisans for $250 each, and her shop sells them for $400 each. She also pays a sales commission of 4% of sales revenue to her sales staff. Pamela leases her country-style shop for $1,700 per month and pays $1,300 per month in payroll costs in addition to the sales commissions. Pamela sold 100 quilts in February. Prepare Pamela's traditional income statement and contribution margin income statement for the month. Prepare the traditional income statement for the month.
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