Course: Principal of Managerial Accounting Course Code: ACCT 201 Spring 2016 Assignment 01

Course: Principal of Managerial Accounting Course Code: ACCT 201 Spring 2016 Assignment 01

Kaahi Shop, Inc., is a large retailer of surfboards. The company assembled the information shown below for the quarter ended May 31:
Amount Total sales revenue $ 800,000
Selling price per surfboard
$ 400 Variable selling expenses per surfboard $50
Variable administrative expenses per surfboard
$20 Total fixed selling expenses $ 150,000
Total fixed administrative expenses
$ 120,000 Merchandise inventory, beginning balance $ 80,000
Merchandise inventory, ending balance
$ 100,000 Merchandise purchases $ 320,000
Required:
1. Prepare a traditional income statement for the quarter ended May 31.
2. Prepare a contribution format income statement for the quarter ended May 31.
3. What was the contribution toward fixed expenses and profits for each surfboard sold during the quarter? (State this figure in a single dollar amount per surfboard).