Req 1 Req 2 Req 3 to 5 Req 6 Which income statement format (traditional format or contribution format) would be more useful to managers in estimating how net operating income will change in responses to changes in unit sales? Traditional income statement Contribution income statement Todrick Company is a merchandiser that reported the following information based on 1,000 units sold: Sales Beginning merchandise inventory Purchases Ending merchandise inventory Fixed selling expense Fixed administrative expense Variable selling expense Variable administrative expense Contribution margin Net operating income $ 375,000 $ 25,000 $ 250,000 $ 12,500 $ ? $ 15,000 $ 18,750 $ ? $ 75,000 $ 22,500 Required: 1. Prepare a contribution format income statement. 2. Prepare a traditional format income statement. 3. Calculate the selling price per unit. 4. Calculate the variable cost per unit. 5. Calculate the contribution margin per unit. 6. Which income statement format (traditional format or contribution format) would be more useful to managers in estimating how net operating income will change in responses to changes in unit sales? Req 1 Reg 2 Req 3 to 5 Req 6 Prepare a contribution format income statement. Todrick Company Contribution Format Income Statement Sales Variable expenses: Cost of goods sold Selling expense Administrative expense 0 Contribution margin Fixed expenses: Selling expense Administrative expense Net operating income Req 1 Reg 2 Req 3 to 5 Req 6 Prepare a traditional format income statement. Todrick Company Traditional Income Statement 0 Selling and administrative expenses: 0 3. Calculate the selling price per unit. 4. Calculate the variable cost per unit. 5. Calculate the contribution margin per unit. 3. Selling price per unit 4. Variable cost per unit 5. Contribution margin per unit Which income statement format (traditional format or contribution format) would be more useful to managers in estimating how net operating income will change in responses to changes in unit sales? Traditional income statement O Contribution income statement