Exercise $1-6($Static$)$ Traditional and Contribution Format Income Statements $[$LO$1-6]$

Cherokee Incorporated is a merchandiser that provided the following information:

Amount

Number of units sold $20,000$

Selling price per unit $ $30$

Variable selling expense per unit $ $4$

Variable administrative expense per unit $ $2$

Total fixed selling expense $ $40,000$

Total fixed administrative expense $ $30,000$

Beginning merchandise inventory $ $24,000$

Ending merchandise inventory $ $44,000$

Merchandise purchases $ $180,000$

Required:

Prepare a traditional income statement.

Prepare a contribution format income statement.

Complete this question by entering your answers in the tabs below.

Required $1$

Required $2$

Prepare a traditional income statement.

Cherokee, Incorporated

Traditional Income Statement

Selling and administrative expenses:

$0$

Prepare a contribution format income statement.

Cherokee, Incorporated

Contribution Format Income Statement

Sales $$600,000$

Variable expenses:

Cost of goods sold $$160,000$

Selling expenses $120,000$

Administrative expenses $70,000$

$350,000$

Fixed expenses:

$0$