J Bryant, Ltd. is a local coat retailer. The stores accountant prepared the following income statement for the month ended January 31. Bryant sells its

J Bryant, Ltd. is a local coat retailer. The store’s accountant prepared the following income statement for the month ended January 31.

Bryant sells its coats for $250 each. Selling expenses consist of fixed costs plus a commission of $6.50 per coat. Administrative expenses consist of fixed costs plus a variable component equal to 5% of sales.

Required
a. Prepare a contribution format income statement for January.
b. Using the format y - mx + b, develop a cost formula for total expenses.
c. If 2,700 coats are sold next month, what is the expected total contributionmargin?

Sales revenue Cost of goods sold Gross margin Less operating expenses $750,000 300,000 450,000 Selling expense Administrative expense 49,500 73,060 $23,560 Net operating income $376,940