Seating Company is currently selling 3,600 oversized bean bag chairs a month at a price of $80 per chair. The variable cost of each chair sold includes $30 to purchase the bean bag chairs from suppliers and a $4 sales commission. Fixed costs are $ 12,000 per month. The company is considering making several operational changes and wants to know how the change will impact its operating income.
Required:
Prepare the company's current contribution margin income statement.
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Ответ:
Contribution margin is $165.600
Net income is $153,600
Explanation:
Contribution margin refers to sales revenue minus all the variables costs of production and distribution of a product.
Therefore, contribution margin income statement is an income statement that is prepared to show the effect of changes in the variable costs on the operating profit by showing the contribution margin before showing the net income for a period.
The company's current contribution margin income statement can be prepared as follows:
Seating Company
Contribution margin income statement
For the month...
Particulars Amount ($)
Sales (3,600 * $80) 288,000
Variable cost:
Purchase of bean bag chairs ($3,600 * $30) (108,000)
Sales commission (3,600 * $4) (14,400)
Contribution margin 165,600
Fixed cost:
Fixed costs (12,000)
Net income 153,600
Ответ:
March 2020 $100.00
Explanation:
The reason why i would say March 2020 has 2,000 people in the usa.