Question

3 The Alpine House, Inc., is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31: 10 points Amount $ 1,215,000 Sales Selling price per pair of skis Variable selling expense per pair of skis Variable administrative expense per pair of skis Total fixed selling expense Total fixed administrative expense 450 48 15 150,000 110,000 65,000 eBook Beginning merchandise inventory Ending merchandise inventory Merchandise purchases 110,000 310,000 Hint Required: 1. Prepare a traditional income statement for the quarter ended March 31. 2. Prepare a contribution format income statement for the quarter ended March 31. Print 3. What was the contribution margin per unit? References Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a traditional income statement for the quarter ended March 31. The Alpine House, Inc. Traditional Income Statement Sales $ 1,215,000 Cost of goods sold Gross margin 265,000 2,700 Selling and administrative expenses: Selling expenses 129,600 Administrative expenses 40,500 Selling expenses 150,000 430,100 Fixed manufacturing overhead 110,000 Net operating income Required 2 > ( Required 1 Mc Graw Hill Education < Prev 3 of 4 Next >

Answer 1

Number of pair of skis sold = Sales / Selling price per pair of skis
Number of pair of skis sold = $1,215,000 / $450
Number of pair of skis sold = 2,700

Cost of goods sold = Beginning merchandise inventory + Merchandise purchases - Ending merchandise inventory
Cost of goods sold = $65,000 + $310,000 - $110,000
Cost of goods sold = $265,000

Answer 1.

Alpine House, Inc. Traditional Income Statement For the Quarter Ended March 31 Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expense $ 279,600 Administrative expense $ 150,500 Net operating income $ $ $ 1,215,000 265,000 950,000 $ $ 430,100 519,900

Selling expenses = Variable selling expense per pair of skis sold * Number of pair of skis sold + Fixed selling expense
Selling expenses = $48 * 2,700 + $150,000
Selling expenses = $279,600

Administrative expenses = Variable administrative expense per pair of skis sold * Number of pair of skis sold + Fixed administrative expense
Administrative expenses = $15 * 2,700 + $110,000
Administrative expenses = $150,500

Answer 2.

$ 1,215,000 Alpine House, Inc. Contribution Income Statement For the Quarter Ended March 31 Sales Variable expenses: Cost of goods sold 265,000 Variable selling expense $ 129,600 Variable administrative expense $ 40,500 Contribution margin Fixed expenses: Fixed selling expense $ 150,000 Fixed administrative expense $ 110,000 Net operating income $ $ 435,100 779,900 $ $ 260,000 519,900

Variable selling expenses = Variable selling expense per pair of skis sold * Number of pair of skis sold
Variable selling expenses = $48 * 2,700
Variable selling expenses = $129,600

Variable administrative expenses = Variable administrative expense per pair of skis sold * Number of pair of skis sold
Variable administrative expenses = $15 * 2,700
Variable administrative expenses = $40,500

Answer 3.

Contribution margin per pair of skis = Contribution margin / Number of pair of skis sold
Contribution margin per pair of skis = $779,900 / 2,700
Contribution margin per pair of skis = $288.85