Answer:
A Cost-Volume-Profit statement is used to show just how the different costs incurred contribute to the expenses. It divides the costs into variable and fixed costs for better analysis.
Sales $2,210,000
Variable Costs:
Cost of Goods sold $921,000
Selling expenses $ 71,000
Admin expenses <u> $87,000</u>
Total variable costs <u> ($1,079,000)</u>
Contribution margin $1,131,000
Fixed costs:
Cost of goods $441,000
Selling expenses $ 46,000
Admin expenses <u> $ 99,000</u>
Total fixed costs <u> ($586,000)</u>
Net operating income <u> $545,000</u>