Prepare a financial reporting income statement

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Reference no: EM13791322

Last Year, Able Co, sold all the goods it produced(it had no finished goods inventories), and sales revenues were $1,260,000. It recorded the following costs for the year:

Manufacturing Selling and Total

Costs Administrative cost

Cost

Variable $420,000 $150,000 $570,000

Fixed 220,500 260,000 480,500

Total $640,500 $410,000 $1,050,500

A. Prepare a Financial Reporting income Statement(that is, in the form required under GAAP for U.S. external reporting).

B. Determine income in the manner used in cost-volume-profit analysis using equation 2.2 profit=revenue-Variable costs-fixed costs

C. At what sales dollar level will Able earn a before-tax target profit of $250,000?

D. At what sales dollar level will Able Break Even?

Reference no: EM13791322

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