Todrick Company is a merchandiser that reported the following information based on 1,000 units sold: Sales Beginning merchandise inventory Purchases Ending merchandise inventory Fixed selling expense Fixed administrative expense Variable selling expense Variable administrative expense Contribution margin Net operating income Required: 1. Prepare a contribution format income statement. 2. Prepare a traditional format income statement. 3. Calculate the selling price per unit. $ 435,000 $ 29,000 $ 290,000 $ 14,500 ? $ 17,400 $ 21,750 ? $ 87,000 $ 26,100

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Todrick Company is a merchandiser that reported the following information based on 1,000 units sold:
Sales
Beginning merchandise inventory
Purchases
Ending merchandise inventory
Fixed selling expense
Fixed administrative expense
Variable selling expense
Variable administrative expense
Contribution margin
Net operating income
Required:
1. Prepare a contribution format income statement.
2. Prepare a traditional format income statement.
3. Calculate the selling price per unit.
4. Calculate the variable cost per unit.
5. Calculate the contribution margin per unit.
$ 435,000
$ 29,000
$ 290,000
$ 14,500
?
$ 17,400
$ 21,750
?
$ 87,000
$ 26,100
6. Which income statement format (traditional format or contribution format) would be more useful to managers in estimating how net
operating income will change in response to changes in unit sales?
Complete this question by entering your answers in the tabs below.
Req 1
Req 2
Req 3 to 5
Req 6
Prepare a contribution format income statement.
Todrick Company
Transcribed Image Text:Todrick Company is a merchandiser that reported the following information based on 1,000 units sold: Sales Beginning merchandise inventory Purchases Ending merchandise inventory Fixed selling expense Fixed administrative expense Variable selling expense Variable administrative expense Contribution margin Net operating income Required: 1. Prepare a contribution format income statement. 2. Prepare a traditional format income statement. 3. Calculate the selling price per unit. 4. Calculate the variable cost per unit. 5. Calculate the contribution margin per unit. $ 435,000 $ 29,000 $ 290,000 $ 14,500 ? $ 17,400 $ 21,750 ? $ 87,000 $ 26,100 6. Which income statement format (traditional format or contribution format) would be more useful to managers in estimating how net operating income will change in response to changes in unit sales? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 to 5 Req 6 Prepare a contribution format income statement. Todrick Company
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