Question

Churchill Corporation, a merchandising company, reported the following results for December:
		Sales	2296200
		Cost of goods sold (all variable)	$997,600
		Total variable selling expense	$86,000
		Total fixed selling expense	$57,100
		Total variable administrative expense	$43,000
		Total fixed administrative expense	$148,100
Required: (a) Prepare a contribution format income statement for December (Using excel) &
(b) Prepare a traditional format income statement for December (using excel)

Answer 1

(a)

Sales revenue	2,296,200
Less: Variable costs
COGS	(997,600)
variable selling expenses	(86,000)
Variable admin exp	(43,000)
Contribution margin	1,169,600
Less: Fixed costs
Fixed selling expense	(57,100)
Fixed admin expense	(148,100)
Net Operating Income	964,400

(b)

Sales revenue		2,296,200
Less: COGS		(997,600)
Gross profit		1,298,600
Operating expenses
Selling expenses:
Variable	(86,000)
Fixed	(57,100)
Admin expenses
Variable	(43,000)
Fixed	(148,100)
Total operating expenses		(334,200)
Net Operating income		964,400