Marwick's Pianos, Incorporated, purchases pianos from a large manufacturer for an average cost of $2,450 per unit and then sells them to retail customers for an average price of $3,125 each. The company's selling and administrative costs for a typical month are presented below.

Costs Cost Formula

Selling:

Advertising $700 per month

Sales salaries and commissions $950 per month, plus 8% of sales

Delivery of pianos to customers $30 per piano sold

Utilities $350 per month

Depreciation of sales facilities $800 per month

Administrative:

Executive salaries $2,500 per month

Insurance $400 per month

Clerical $1,000 per month, plus $20 per piano sold

Depreciation of office equipment $300 per month

During August, Marwick's Pianos, Incorporated, sold and delivered 40 pianos.

Required:

1. Develop a traditional format income statement for August.

2. Develop a contribution format income statement for August. Show costs and revenues on both a total and a per unit basis down through contribution margin.