Last Month,Pioneer Company Sold Its Product for $50 Per Unit

Question

Examlex · Accepted Answer

The Answer is

\quad

\quad

\quad

\quad

\quad

\quad

ext { Traditional Income Statement }

\begin{array}{lr} ext { Sales } & \$ 200,000&(=\$ 50 ext { price per unit } imes 4,000 \&& ext { units })\ ext { Cost of goods sold } & 52,000 &{[=\$ 20,000+(\$ 8.00 imes 4,000}\&& ext { units })] \ ext { Gross margin } & \$ 148,000 \ ext { Selling and admin. costs } & 25,000&{[=\$ 13,000+(\$ 3.00 imes 4,000} \&& ext { units })]\ ext { Operating profit }& \$ 123,000\end{array}

$\quad \quad \quad \quad \quad \quad ext { Traditional Income Statement } \begin{array}{lr} ext { Sales } & \$ 200,000&(=\$ 50 ext { price per unit } imes 4,000 \ && ext { units })\ ext { Cost of goods sold } & 52,000 &{[=\$ 20,000+(\$ 8.00 imes 4,000}\ && ext { units })] \ ext { Gross margin } & \$ 148,000 \ ext { Selling and admin. costs } & 25,000&{[=\$ 13,000+(\$ 3.00 imes 4,000} \ && ext { units })]\ ext { Operating profit }& \$ 123,000 \end{array} (3) The traditional income statement is designed for external reporting purposes and presents costs by functional area such as cost of goods sold and selling and administrative costs. The traditional income statement does not separate costs into fixed and variable components. The contribution margin income statement presents the fixed and variable components of all cost information. This allows management to predict how costs will behave with changes in activity, which ultimately leads to better planning and decision-making$ (3) The traditional income statement is designed for external reporting purposes and presents costs by functional area such as cost of goods sold and selling and administrative costs. The traditional income statement does not separate costs into fixed and variable components.

The contribution margin income statement presents the fixed and variable components of all cost information. This allows management to predict how costs will behave with changes in activity, which ultimately leads to better planning and decision-making

Last Month,Pioneer Company Sold Its Product for $50 Per Unit

Essay

Correct Answer:
Verified

Last Month,Pioneer Company Sold Its Product for $50 Per Unit

Essay

Correct Answer:VerifiedShow Answer

Correct Answer:
Verified