Smithen Company, a wholesale distributor, has been operating for only a few months. The company sellsthree products-sinks, mirrors, and vanities. Budgeted sales by product and in total for the coming monthare shown below based on planned unit sales as follows:SinksMirrorsVanitiesTotalPercentage of totalsalesSalesVariable expensesContribution marginunitUnits Percentage50%6003003001,200Contribution margin perFixed expensesOperating income25%25%100%SSinks46%319.99$239,992.00 100% $157,200 100% $126,808.00 100% $524,000.00 100%47,998.40 20% 125,760 80% 63,404.00 50% 237,162.40 45%$191,993.6080% $ 31,44020% $63,404.00 50% 286,837.60 55%Break-even point in sales dollars -ProductMirrors30%S 104.80Fixed expensesOverall CM ratio$248,050$239.03*$248,0500.55Vanities24%1,037.73 units$ 211.35Total100%=$451,000Break-even point in unit sales:Total Fixed expensesWeighted average CM per unit*($319.99 x 0.50) + ($104.80 x 0.25)+($211.35 × 0.25)Assume that actual sales for the month total $637,376 (1,400 units), with the CM ratio and per unitamounts the same as budgeted. Actual fixed expenses are the same as budgeted, $248,050. Actual salesby product are as follows: sinks, $195,993 (490 units); mirrors, $293,440 (560 units); and vanities, $147,943(350 units).248,050.00$ 38,787.60Required:1. Prepare a contribution format income statement for the month based on actual sales data. (Round yourpercentage answers to the nearest whole number.)

Income statement is the important part of financial statement, which shows income and expenditure of…

Smithen Company, a wholesale distributor, has been operating for only a few months. The company sells three products-sinks, mirrors, and vanities. Budgeted sales by product and in total for the coming month are shown below based on planned unit sales as follows: Sinks Mirrors Vanities Total Percentage of total sales Sales Variable expenses Contribution margin unit Units Percentage 600 50% 300 300 1,200 Fixed expenses Contribution margin per s 25% 25% 100% Sinks 46% $239,992.00 47,998.40 $191,993.60 319.99 Product Mirrors 30% $ 104.80 Vanities 24% 100% $157,200 100% $126,808.00 20% 125,760 80% $ 31,440 100% $524,000.00 100% 80% 63,404.00 50% 237,162.40 45% 20% $63,404.00 50% 286,837.60 55% $ Total 100% 211.35 248,050.00

Smithen Company, a wholesale distributor, has been operating for only a few months. The company sells three products-sinks, mirrors, and vanities. Budgeted sales by product and in total for the coming month are shown below based on planned unit sales as follows: Sinks Mirrors Vanities Total Percentage of total sales Sales Variable expenses Contribution margin unit Units Percentage 600 50% 300 300 1,200 Fixed expenses Contribution margin per s 25% 25% 100% Sinks 46% $239,992.00 47,998.40 $191,993.60 319.99 Product Mirrors 30% $ 104.80 Vanities 24% 100% $157,200 100% $126,808.00 20% 125,760 80% $ 31,440 100% $524,000.00 100% 80% 63,404.00 50% 237,162.40 45% 20% $63,404.00 50% 286,837.60 55% $ Total 100% 211.35 248,050.00

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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