Question

For its top managers, Global Travel formats its income statement as follows:
GLOBAL TRAVEL
Contribution Margin Income Statement
Three Months Ended March 31, 2016
Sales Revenue ....... $ 318,500
Variable Costs ....... 111,475
Contribution Margin ...... 207,025
Fixed Costs ........ 175,000
Operating Income ....... $ 32,025
Global’s relevant range is between sales of $250,000 and $360,000.
Requirements
1. Calculate the contribution margin ratio.
2. Prepare two contribution margin income statements: one at the $250,000 sales level and one at the $360,000 sales level.


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  • CreatedJune 15, 2015
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