Please help me with the functions for this ! Thank you! Jay Corporation has decided to prepare contribution income statements for internal planning. Budgeted information for Quarter 1 of 2024: Sales in units17,000 Sales price per unit$48.00 After analyzing expenses, the company has determined the following cost patterns. Cost of Goods Sold (per unit)$29.00 Sales Commissions (per dollar of sales)9.50% Administrative Salaries (per quarter)$45,000 Rent Expense (per quarter)$27,000 Depreciation Expense (per quarter)$36,000 Shipping has been determined to be a mixed cost with the following total costs and units: 2022Total CostUnits Quarter 1$67,000 12,500 Quarter2$94,000 21,000 Quarter 3$89,800 13,800 Quarter 4$92,600 20,000 2023 Quarter 1$72,500 13,700 Quarter2$80,000 14,000 Quarter 3$84,000 14,300 Quarter 4$100,000 22,500 Use the data to answer the following. 1. Using the high-low method, determine a cost formula for shipping costs.High level of activityLow level of activityChange in activityVariable cost per unitFixed cost portion:Total cost at high level of activityLess: Variable cost elementTotal fixed costTotal CostUnits 2. Prepare a contribution margin income statement for Quarter 1 of 2024.SalesVariable expenses:Cost of goods soldSales commissionsShipping expenseTotal variable expensesContribution marginFixed expenses:Adminstrative salariesRent expenseShipping expenseDepreciation expenseTotal fixed expensesNet operating incomeJay CorporationBudgeted Income StatementFor 2024, Quarter 1

High Low Method - This method is used to segregate the variable and fixed cost. This method is…

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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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Please help me with the functions for this ! Thank you!

Jay Corporation has decided to prepare contribution income statements for internal planning.

Budgeted information for Quarter 1 of 2024:
Sales in units	17,000
Sales price per unit	$48.00

After analyzing expenses, the company has determined the following cost patterns.
Cost of Goods Sold (per unit)	$29.00
Sales Commissions (per dollar of sales)	9.50%
Administrative Salaries (per quarter)	$45,000
Rent Expense (per quarter)	$27,000
Depreciation Expense (per quarter)	$36,000

Shipping has been determined to be a mixed cost with the following total costs and units:

2022	Total Cost	Units
Quarter 1	$67,000	12,500
Quarter2	$94,000	21,000
Quarter 3	$89,800	13,800
Quarter 4	$92,600	20,000
2023
Quarter 1	$72,500	13,700
Quarter2	$80,000	14,000
Quarter 3	$84,000	14,300
Quarter 4	$100,000	22,500

Use the data to answer the following.

1. Using the high-low method, determine a cost formula for shipping costs.
High level of activity
Low level of activity
Change in activity
Variable cost per unit
Fixed cost portion:
Total cost at high level of activity
Less: Variable cost element
Total fixed cost
Total Cost
Units

2. Prepare a contribution margin income statement for Quarter 1 of 2024.
Sales
Variable expenses:
Cost of goods sold
Sales commissions
Shipping expense
Total variable expenses
Contribution margin
Fixed expenses:
Adminstrative salaries
Rent expense
Shipping expense
Depreciation expense
Total fixed expenses
Net operating income
Jay Corporation
Budgeted Income Statement
For 2024, Quarter 1

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