Prepare a contribution format income statement

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Reference no: EM131217822

Honest Donald's Auto Dealer purchase used cars at auto auctions and sells them retail. The auto, on average, sell for approximately $17,500 each and cost Donald $11,500. The costs that the company incurs in atypical month are listed below: SELLING: advertising ($2,400 per month), preparation of auto for delivery ($250 per auto sold, salaries & commissions ($4,200 per month, plus 8% of sales), utilities ($3,500 per month), depreciation on sales facility ($4,200 per month). ADMINISTRATIVE: executive salaries ($13,000 per month), depreciation on office equipment ($2,000 per month), clerical ($3,000 per month), insurance ($1,200 per month). During July Honest Doanld's sold 50 autos. Prepare a traditional income statement for July. Prepare a contribution format income statement for July. Show costs and revenues on both a total and per unit basis down through contribution margin.

Reference no: EM131217822

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Prepare a contribution format income statement : Honest Donald's Auto Dealer purchase used cars at auto auctions and sells them retail. The auto, on average, sell for approximately $17,500 each and cost Donald $11,500. The costs that the company incurs in atypical month are listed below: Prepare a ..
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