Reference no: EM131773395

I don't know how to make the variable income statements and other statements required for the following data;

		Price Categories
	A	B	C	D	E
Units Sold	2,000	1,000	500	400	400
Units Purchased	3,000	1,200	1,000	1,000	1,000
Resale Price	$4.00	$15.00	$25.00	$45.00	$40.00
Cost	$0.50	$5.00	$10.00	$20.00	$20.00

In addition to purchasing inventory (used books), the company incurs some operating expenses.

Variable operating expenses
	Shipping per book	$ 1.50
Fixed expenses
	Internet-related costs	$5,000
	Travel, etc.	2,000
	Advertising	1,000
	Other overhead	3,000

Required:

Computations (use Excel)

• Prepare a segmented variable costing (behavioral) income statement for the company in good format.
• Prepare a second variable costing statement assuming 90% of all the books in each category purchased were actually sold.
• Prepare a third variable costing statement assuming that the price is increased by 50% for all five categories (use original sales information).
• The owner enjoys the used-book business. Any suggestions as how to turn this into a full-time business venture so the owner can quit his other job? Prepare another income statement to support your idea.