Question

Bramble Inc. has sales of $2,059,000 for the first quarter of 2020. In making the sales, the company incurred the following costs and expenses. Variable Fixed Cost of goods sold $765,000 $607,000 Selling expenses 96,500 66,000 Administrative expenses 83,700 73,000 Prepare a CVP income statement for the quarter ended March 31, 2020.

Answer 1

Answer:

Explanation:

The preparation of the CVP income statement is shown below:

                                           Bramble Inc

                                    CVP income statement

                       For the quarter ended March 31, 2020

Sales   (A)                                                                           $2,059,000

Variable cost

Cost of goods sold                                 $765,000

Selling expenses                                    $96,500

Administrative expenses                       $83,700

Total Variable cost  (B)                                                        $945,200  

Contribution margin (A-B) / C                                            $1,113,800

Fixed expenses

Cost of goods sold                                 $607,000

Selling expenses                                    $66,000

Administrative expenses                       $73,000

Total fixed cost  (D)                                                              $746,000  

Net income (C-D)                                                                  $367,800