Answer:
J Crane, Ltd
Contribution Margin Income Statement
For the Month ended January 31 YY
$ $
Sales revenue 750,000
Less Variable cost :
Cost of goods sold 300,000
Selling expenses 19,500
Admin Expense <u> 37,500</u>
<u> 357,000 </u>
Contribution Margin 393,000
Less Fixed cost :
Selling expense 4,060
Administrative expense <u> 12,000</u>
<u> 16,060 </u>
Net income <u> </u><u>376,940</u>
<u />
<u>Working:</u>
Number of Coat sold = 750,000/250 = 3000 coats
Variable costs:
Selling expenses = 6.5 x 3000 = 19500
Admin Expense = 750,000 x 5% = 37,500
Fixed cost:
Selling expenses = 23560 - 19500 = 4060
Admin Expense = 49,500 - 37,500 = 12,000
