Assume that the company expects sales of each product to increase to 56,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year. Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 42,000 units of each product. Income statements for each product follow. Carvings Mementos Sales $ 747,600 $ 747,600 Variable costs 523,320 149,520 Contribution margin 224,280 598,080 Fixed costs 108,280 482,080 Income $ 116,000 $ 116,000
Assume that the company expects sales of each product to increase to 56,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year. Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 42,000 units of each product. Income statements for each product follow. Carvings Mementos Sales $ 747,600 $ 747,600 Variable costs 523,320 149,520 Contribution margin 224,280 598,080 Fixed costs 108,280 482,080 Income $ 116,000 $ 116,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
Assume that the company expects sales of each product to increase to 56,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year.
Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 42,000 units of each product. Income statements for each product follow.
| Carvings | Mementos | |
|---|---|---|
| Sales | $ 747,600 | $ 747,600 |
| Variable costs | 523,320 | 149,520 |
| Contribution margin | 224,280 | 598,080 |
| Fixed costs | 108,280 | 482,080 |
| Income | $ 116,000 | $ 116,000 |
Transcribed Image Text:Contribution margin
Income (loss)
HENNA COMPANY
Contribution Margin Income Statement
Carvings
Units
$ Per unit
$
GA
$
Total
0
0
0
Mementos
$ Per unit
$
$
Total
0 $
0
0 $
Total
0
0
0
0
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education