E Chapter 5. Problem 2B Bookmark Show a steps: ON Problem Special order, Terminology, and Unit Costs Following is the income statement of Pelle Company, a manufacturer of men's blue jeans: Pelle Company Income Statement for the Year Ended December 31, 20x0 Per Unit Total $77000.000 $35.00 Less: Cost of goods sold 2100 Gross margin $1400 Less selling and administrative expenses Operating income Pelle had manufactured 2.2 million pairs of jeans, which had been sold to various clothing wholesalers and department stores. At the start of 20X0, the president, Ruth Catone, died unexpectedly Her son, Chuck, became the new president. Chuck had worked for 15 years in the marketing phases of the business. He knew very little about accounting and manufacturing, which were his mothers strengths. Chuck has several questions, including inquiries regarding the pricing of special orders. 1. To prepare better answers, you decide to recast the income statement in contribution form. Variable manufacturing cost was $35.2 million. Variable selling and administrative expenses, which were mostly sales commissions, shipping expenses, and advertising allowances paid i ENG 2.46 PM 27-Dec-16