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sukhopar [10]
3 years ago
13

5b. MousePad Computer Company, in addition to its retail sales, conducts night classes in computer technology. MousePad has prov

ided you the following information: Number of students 120 Revenue per student $450 Student-related variable costs $100 per student Salary for three instructors $1,800 each Administrative costs $30 per student Maintenance on building $15,000 per year Required: Construct a contribution margin format income statement.
Business
1 answer:
monitta3 years ago
8 0

Answer:

Net Income = $18,000

Explanation:

              MousePad Computer Company

       Contribution Margin Income statement

Revenue (120 students × $450)                                      = $54,000

Less: Variable expenses:

Student-related costs (120 students × $100) = $12,000

Administrative costs (120 students × $30)     = $ 3,600

Total variable expenses                                               <u>    =($15,600)</u>

Contribution Margin                                                          $38,400

Less: Fixed cost

Instructors salary (3 × $1,800)       = $ 5,400

Maintenance on building              = $15,000

<u>Total fixed cost                                                                 =$(20,400)</u>

Net Operating Income                                                    =$18,000

Note:

Students cost is a variable expense, because if we decrease the student's number, the revenue and expenses will decrease proportionately. Moreover, the company is getting profit from the students.

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Answer: D. $40,175

Explanation:

The balance in the Capital account reported on the Statement of Owner's Equity will include the Capital contributions of Andrea Apple to the business as well as the Net income from operations also known as Retained Earnings.

The Net Income for the month will be revenue less expenses.

Revenue

$5,700 cash and $2,750 on account for services provided in January.

Revenue is therefore,

= 5,700 + 2,750

= $8,450

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The Capital that Mr. Apple brought into the business refers to anything he contributed to the business whether in cash or otherwise.

The Capital therefore is,

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The Capital Mr. Apple brought into the business is therefore,

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Option D. is correct.

3 0
3 years ago
Carryon Company sells a product and a 12-month service package for that for a combined price of $800. Separately, the product an
anzhelika [568]

The part of the combined price allocated to the product is less than 50% which might be around 35-40%.

<u>Explanation:</u>

Since the price of the product all alone is $450 and the price of the service alone is $550, so the combined amount totals up to be nothing less than $1000. But the company under the discount and offer, offers the both things combined for $800.

This shows that the company is under some loss which it has to incur. The loss is of $200 under the discount to be offered to the clients which serves as the incentive to the customers.

3 0
3 years ago
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Wher do we choose the communication planning and resource?
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3 years ago
Ming Chen began a professional practice on June 1 and plans to prepare financial statements at the end of each month. During Jun
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Answer:

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Explanation:

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