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Prepare a contribution margin income statement (also called a variable-costing income statement) for the manufacturing...

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Accounting

Prepare a contribution margin income statement (also called a variable-costing income statement) for the manufacturing company for the upcoming year. Check Figure: Operating profit (Operating Income) of $14,295,000.

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PARAMETERS FOR BASELINE CASE The following numbers are estimates for the upcoming year for a manufacturing company Since the company is effective at implementing a JIT inventory system, assume there is no beginning or ending inventory No. of units sold Selling price per unit 120,000 $240.00 Variable Expenses Fixed Expenses (per unit sold Production costs: Direct materials 18.00 36.00 24.00 Direct labor Factory overhead Marketing expenses $2,160,000 Sales salaries and commissions Advertising Miscellaneous mktg. expenses 7.50 540,000 360,000 108,000 Administration expenses Office salaries Supplies Miscellaneous admin. expenses 720,000 105,000 72,000 $4,065,000 1.50 TOTAL EXPENSES 87.00

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