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Home > Education > Homework Help > Finance & Accounting   »   income statement

 
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Old Nov 29, 2006, 11:55 PM
MelanieRhea
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income statement

I am really having trouble with this question... Please Help

The Music Box Company manufactures compact discs. Each disc sells for
$3.50 with unit variable manufacturing expenses of $1.50. For the year
ended December 31, 20X6, total fixed manufacturing expenses were
$325,000 and 500,000 discs were produced and sold. Marketing expenses
amounted to 8% of sale price plus $40,000 in fixed expenses.
Administrative expenses included $17,500 in fixed expenses and variable
expenses equal to 5% of sale price.

a) Prepare a conventional income statement for the year ended
December 31, 20X6.
b) Prepare a contribution margin income statement for the year ended
December 31, 20X6.

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