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The Alpine House, Inc., is a large retailer of snow skis. The company assembled the information shown below for the quarter ended March 31:
Amount
Total sales revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $150,000
Selling price per pair of skis . . . . . . . . . . . . . . . . . . . . . . . $ 750
Variable selling expense per pair of skis . . . . . . . . . . . . $ 50
Variable administrative expense per pair of skis . . . . . . . $ 10
Total fixed selling expense . . . . . . . . . . . . . . . . . . . . . . . . $ 20,000
Total fixed administrative expense . . . . . . . . . . . . . . . . . . $ 20,000
Beginning merchandise inventory . . . . . . . . . . . . . . . . . . $ 30,000
Ending merchandise inventory . . . . . . . . . . . . . . . . . . . . . $ 40,000
Merchandise purchases . . . . . . . . . . . . . . . . . . . . . . . . . . $100,000
Required:
1. Prepare a traditional income statement for the quarter ended March 31.
2. Prepare a contribution format income statement for the quarter ended March 31.
3. What was the contribution toward fixed expenses and profits for each pair of skis sold during the quarter? (State this figure in a single dollar amount per pair of skis.)
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