To aid in planning, Jay Corporation's Q1 of Year 3 Contribution Format Income Statement Preparation

Budgeted Information for Quarter 1 of Year 3:

Sales: 17,000 units sold

Sales Price per Unit: $48.00

Cost Patterns:

Cost of Goods Sold: $29.00 per unit, 9.50% per dollar of sales

Sales Commissions: 9.50% of total revenues

Administrative Salaries: $45,000.00 per quarter

Rent Expense: $36,000.00 per quarter

Depreciation Expense

Management has concluded that shipping expense is a mixed cost. Units shipped and the related shipping cost over the last eight quarters are:

Year 1 Total Shipping Cost Units
Quarter 1 $67,000.00 12,500
Quarter 2 $94,000.00 21,000
Quarter 3 $89,800.00 13,800
Quarter 4 $92,600.00 20,000
How can Jay Corporation prepare a contribution format income statement for Q1 of Year 3? The answer describes how to prepare a contribution format income statement for Jay Corporation's Q1 of Year 3 by calculating total revenues, estimating the shipping cost based on the data from earlier quarters, and calculating total costs, including cost of goods sold, commissions, salaries, rent, and depreciation. The resulting income statement is derived by subtracting total costs from total revenues.
← Main methods of capitalizing an llc Jamie dimon s communication strategy →

More Posts: