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Redhawk, Inc., is a merchandiser that provided the following information:
Number of units sold ----------- 10,000
Selling price per unit ---------- $15
Variable selling expense per unit---$2
Variable administrative expense per unit --------- $1
Total fixed selling expense -------- $20,000
Total fixed administrative expense -------- $15,000
Merchandise inventory, beginning balance --------- $12,000
Merchandise inventory, ending balance ------------ $22,000
Merchandise purchases ----------- $90,000
Required:
1. Prepare a traditional income statement
2. Prepare a contribution format income statement
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