
a.
Introduction:
Traditional income statements: Normally, this type of statement is prepared in a manufacturing concern. It is based on cost of goods sold and selling and administrative expenses.
Contribution income statements: When net operating income has to be calculated in terms of fixed and variable behaviors, contribution income statements have to be prepared.
To prepare: A traditional format income statement for August.
b.
Introduction:
Traditional income statements: Normally, this type ofstatements is prepared in a manufacturing concern. It is based cost of goods sold and selling and administrative expenses.
Contribution income statements: When net operating income has to be calculated in terms of fixed and variable behaviors, contribution income statements have to be prepared.
Requirement 2 To prepare: A contribution format income statement for August.
c.
Introduction:
Traditional income statements: Normally, this type ofstatements is prepared in a manufacturing concern. It is based cost of goods sold and selling and administrative expenses.
Contribution income statements: When net operating income has to be calculated in terms of fixed and variable behaviors, contribution income statements have to be prepared.
To analyze: The reason for the statement misleading everyone when the fixed cost is shown on a per-unit basis.

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Chapter 1 Solutions
Loose Leaf For Managerial Accounting for Managers
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