Marwick's Planos, Incorporated, purchases planos from a manufacturer for an average cost of $1,516 per unit...

 

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Marwick's Planos, Incorporated, purchases planos from a manufacturer for an average cost of $1,516 per unit and then sells them to retail customers for an average price of $2,400 each. The company's selling and administrative costs for a typical month are presented below: Costs Selling: Advertising Sales salaries and commissions Delivery of planos to customers Utilities Depreciation of sales facilities Administrative: Executive salaries Insurance Clerical Depreciation of office equipment Cost Formula $954 per month $4,810 per month, plus 5% of sales. $62 per piano sold $657 per month $4,960 per month $13,408 per month $681 per month $2,537 per month, plus $42 per piano sold $914 per month During August, Marwick's Pianos, Incorporated, sold and delivered 62 planos. Required: 1. Prepare a traditional format Income statement for August 2. Prepare a contribution format Income statement for August. Show costs and revenues on both a total and a per-unit basis down through contribution margin. Marwick's Planos, Incorporated, purchases planos from a manufacturer for an average cost of $1,516 per unit and then sells them to retail customers for an average price of $2,400 each. The company's selling and administrative costs for a typical month are presented below: Costs Selling: Advertising Sales salaries and commissions Delivery of planos to customers Utilities Depreciation of sales facilities Administrative: Executive salaries Insurance Clerical Depreciation of office equipment Cost Formula $954 per month $4,810 per month, plus 5% of sales. $62 per piano sold $657 per month $4,960 per month $13,408 per month $681 per month $2,537 per month, plus $42 per piano sold $914 per month During August, Marwick's Pianos, Incorporated, sold and delivered 62 planos. Required: 1. Prepare a traditional format Income statement for August 2. Prepare a contribution format Income statement for August. Show costs and revenues on both a total and a per-unit basis down through contribution margin.