Following is Hartzbergs latest income statement. The company produced and sold 100,000 units during the year. Sales
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Following is Hartzberg’s latest income statement. The company produced and sold 100,000 units during the year. Sales (100,000 units at $50) $5,000,000 Cost of goods sold:
Direct material $1,500,000
Direct labor 800,000
Variable manufacturing overhead 300,000
Fixed manufacturing overhead 1,200,000
Total cost of goods sold 3,800,000
Gross profit 1,200,000
Selling expenses:
Variable 200,000
Fixed 700,000
Total selling expenses 900,000
Operating income $300,000
Restate the income statement in contribution margin format, as if Hartzburg had used a variable costing system to report income.
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