FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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11 Number of batches sold
18,600
12 Pints produced with each batch
13 Selling price per batch
40
93.00
14 Variable materials per batch
35.70
15 Variable labor per batch
27.75
16 Variable Overhead per Batch
10.75
17 Variable selling expenses per batch
18 Variable administrative expenses per batch
3.00
$
2.50
19 Sales salaries
40,000
20 Executive Salaries
110,000
21 Office Staff Salary
40,000
22 Office Occupancy
10,000
23 Fixed Factory Overhead
$
30,000
24
25
Leaf Peepers Ice Cream, Inc.
Traditional Income Statement - Projected
Leaf Peepers Ice Cream, Inc.
Contribution Income Statement - Projected
26
27
For the Year Ended December 31, 2021
For the Year Ended December 31, 2021
28
29
Sales Revenues
30 Sales Revenues
1,729,800
Variable Costs
31 Cost of Goods Sold
1,410,120
Materials
32 Gross Profit
319,680
Labor
33
Overhead
34 Selling Expenses
95,800
Selling
35 Administrative Expenses
206,500
Administrative
36 Total Selling & Administrative Expenses
302,300
Total Variable Costs
37 Net Operating Income
$
17,380
Contribution Margin
38
39
Fixed Costs
40
Selling
Pro Tip: When formatting your income statement
remember that it is just 1 schedule, despite any
41
Administrative
gaps that are formed for aesthetic purposes.
42
Overhead
43
Total Fixed Costs
44
Net Operating Income
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Transcribed Image Text:11 Number of batches sold 18,600 12 Pints produced with each batch 13 Selling price per batch 40 93.00 14 Variable materials per batch 35.70 15 Variable labor per batch 27.75 16 Variable Overhead per Batch 10.75 17 Variable selling expenses per batch 18 Variable administrative expenses per batch 3.00 $ 2.50 19 Sales salaries 40,000 20 Executive Salaries 110,000 21 Office Staff Salary 40,000 22 Office Occupancy 10,000 23 Fixed Factory Overhead $ 30,000 24 25 Leaf Peepers Ice Cream, Inc. Traditional Income Statement - Projected Leaf Peepers Ice Cream, Inc. Contribution Income Statement - Projected 26 27 For the Year Ended December 31, 2021 For the Year Ended December 31, 2021 28 29 Sales Revenues 30 Sales Revenues 1,729,800 Variable Costs 31 Cost of Goods Sold 1,410,120 Materials 32 Gross Profit 319,680 Labor 33 Overhead 34 Selling Expenses 95,800 Selling 35 Administrative Expenses 206,500 Administrative 36 Total Selling & Administrative Expenses 302,300 Total Variable Costs 37 Net Operating Income $ 17,380 Contribution Margin 38 39 Fixed Costs 40 Selling Pro Tip: When formatting your income statement remember that it is just 1 schedule, despite any 41 Administrative gaps that are formed for aesthetic purposes. 42 Overhead 43 Total Fixed Costs 44 Net Operating Income
Expert Solution
Check Mark
Step 1

Costs are bifurcated into variable and fixed elements. This is done for cost-volume-profit analysis.

These help in identifying fixed costs, variable costs, break-even point, margin of safety, etc.

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