Contribution Margin Income Statement: The contribution margin income statement breaks the profit calculations into contribution margin and Net operating income. The contribution margin is calculated by subtracting total variable costs from net sales revenue and net operating income is calculated by subtracting the total fixed costs from the contribution margin. Traditional Income Statement: The Traditional Income statement calculates net operating income in two steps. It calculates the gross profit by subtracting the cost of goods sold from the net sales revenue and net operating income is then calculated by subtracting the other operating costs (selling and administrative costs) from the gross profits. To indicate: The difference between the Contribution Margin Income Statement and the Traditional Income Statement

Question

Want to see the full answer?

Answer 1

Question

Chapter 21, Problem 11RQ

To determine

Concept introduction:

Contribution Margin Income Statement: The contribution margin income statement breaks the profit calculations into contribution margin and Net operating income. The contribution margin is calculated by subtracting total variable costs from net sales revenue and net operating income is calculated by subtracting the total fixed costs from the contribution margin.

Traditional Income Statement: The Traditional Income statement calculates net operating income in two steps. It calculates the gross profit by subtracting the cost of goods sold from the net sales revenue and net operating income is then calculated by subtracting the other operating costs (selling and administrative costs) from the gross profits.

To indicate: The difference between the Contribution Margin Income Statement and the Traditional Income Statement

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

ayco Inc. started its operations in 2022. Its sales during 2022, all on account, totalled $700,000. The company collected $500,000 in cash from customers during the year and wrote off $8,000 in uncollectible accounts. The company set up an allowance for doubtful accounts at December 31, 2022, its fiscal year-end, and determined the account balance to be $14,000. The unadjusted balances of selected accounts at December 31, 2023 are as follows: Accounts receivable $ 300,000 Allowance for doubtful accounts (debit) 10,000 Sales revenue (including 80 percent in sales on account) 800,000 Aging of the accounts receivable on December 31, 2023, resulted in an estimate of $11,000 in potentially uncollectible accounts. Required: 1. Prepare the journal entries to record all the transactions during 2022 and post them to appropriate T-accounts. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)…

Calculate the sample size based on the specifications in Buhi's contract. Make sure it is within budget, reasonable to obtain, and that you use appropriate inputs relative to market research best practices. Use the calculator to adjust the sample size statement. Use the agreed-upon sample size in Buhi's contract: 996. In your secondary research, find the target population size (an estimate of those in the United States looking to purchase luggage in the category in the next two years). You will use this target population size for each sample size estimate. Adjust the provided sample size calculator inputs to find the rest of the figures that get you to the agreed-upon sample size. The caveats from Buhi are that you must: Use the market research standard for your confidence level. Use a confidence interval that is better than the market research standard for your confidence interval.

The partnership of Keenan and Kludlow paid the following wages during this year: Line Item Description Amount M. Keenan (partner) $108,000 S. Kludlow (partner) 96,000 N. Perry (supervisor) 54,700 T. Lee (factory worker) 35,100 R. Rolf (factory worker) 27,200 D. Broch (factory worker) 6,300 S. Ruiz (bookkeeper) 26,000 C. Rudolph (maintenance) 5,200 In addition, the partnership owed $250 to Rudolph for work he performed during December. However, payment for this work will not be made until January of the following year. The state unemployment tax rate for the company is 2.95% on the first $9,000 of each employee's earnings. Compute the following: ound your answers to the nearest cent. a. Net FUTA tax for the partnership for this year b. SUTA tax for this year