Marwick's Pianos, Inc., purchases pianos from a large manufacturer and sells them at the retail...
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Marwick's Pianos, Inc., purchases pianos from a large manufacturer and sells them at the retail level. The pianos cost, on the average, $1,482 each from the manufacturer Marwick's Pianos, Inc., sells the pianos to its customers at an average price of $2,900 each. The selling and administrative costs that the company incurs in a typical month are presented below: Costs Cost Formula Selling $940 per month Advertising Sales salaries and commissions $4,777 per month, plus 4% of sales $61 per piano sold Delivery of pianos to customers $640 per month Utilities Depreciation of sales facilities $4,939 per month Administrative $13,537 per month Executive salaries $708 per month Insurance Clerical $2,459 per month, plus $42 per piano sold $886 per mon Depreciation of office equipment During August, Marwick's Pianos Inc., sold and delivered 56 pianos. Required 1. Prepare an income statement for Marwick's Pianos, Inc., for August. Use the traditional format, with costs organized by function. (A "Net operating loss" should be entered as a negative number)
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