Patricia's Quilt Shoppe sells homemade Amish quilts. Patricia buys the quilts from local Amish artisans for $230

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Patricia's Quilt Shoppe sells homemade Amish quilts. Patricia buys the quilts from local Amish artisans for $230 each, and her shop sells them for $380 each. Patricia also pays a sales commission of 10% of sales revenue to her sales staff. Patricia leases her country style shop for $800 per month and pays $1,200 per month in payroll costs in addition to the sales commissions. Patricia sold 75 quilts in February. Prepare Patricia's traditional income statement and contribution margin income statement for the month.
Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...
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Related Book For  answer-question

Managerial Accounting

ISBN: 978-0132890540

3rd edition

Authors: Karen W. Braun, Wendy M. Tietz

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