Topper Sports, Inc._Income Statement_Contribution Margin

$11.00

Description

Topper Sports, Inc.
produces high quality sports equipment. The company’s Racket Division
manufactures three tennis rackets- the Student, the Deluxe, and the Pro- that
are widely used in amateur day. Selected information on the rackets is given
below:

Standard

Selling Price per
racket: $43.00

Variable Expenses per
racket:

Production: $17.20

Selling (5% of selling
price): $2.15

Deluxe

Selling Price per
Racket: $62.00

Variable Expenses Per
Racket:

Production: $21.70

Selling (5% of selling
price): $3.10

Pro

Selling Price per
Racket: $87.00

Variable Expenses per
Racket:

Production: $26.10

Selling (5% of selling
price): $4.35

All sales are made
through the company’s own retail outlets. The Racket Division has the following
fixed costs:

Per Month

Fixed Production Costs:
$107,000

Advertising Expense:
$108,000

Administrative
Salaries: $52,000

Total: $267,000

Sales, in units, over
the past two months have been as follows:

Standard (April): 4,000

Deluxe (April): 3,000

Pro (April): 7,000

Total (April): 14,000

Standard (May): 11,000

Deluxe (May): 3,000

Pro (May): 6,000

Total (May): 20,000

a. Prepare
contribution format income statements for April. (Round the “Total percent”
answers to one decimal place. Input all amounts as positive values except
losses which should be indicated by minus sign. Omit the “$” and “%” signs in
your response).

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