Larcker manufacturing's cost accountant has provided you with the following information for january operations. direct materials $ 34 per unit fixed manufacturing overhead costs $ 230,000 sales price $ 190 per unit variable manufacturing overhead $ 18 per unit direct labor $ 30 per unit fixed marketing and administrative costs $ 205,000 units produced and sold $ 6,000 variable marketing and administrative costs $ 8 per unit required: a. prepare a gross margin income statement. b. prepare a contribution margin income statement.

Please see details below

Explanation:

Gross Margin income statement  

Sales$ 1.140.000

Direct Labor  -$ 180.000

Direct Materials-$ 204.000

Variable Manuf. Overhead-$ 204.000

Gross Profit$ 552.000

Manufacturing Overhead-$ 230.000

Fixed Mktg Costs-$ 205.000

Operating Expenses-$ 35.000

Variable Mktg Cost-$ 48.000

Net Income$ 34.000

Contribution Margin Inc. statement.  

Sales$ 1.140.000

Direct Labor  -$ 180.000

Direct Materials-$ 204.000

Variable Manuf. Overhead-$ 204.000

Gross Contribution Margin$ 552.000

Variable Mktg Cost-$ 48.000

Fixed Mktg Costs-$ 205.000

Operating Expenses-$ 35.000

Contribution Margin$ 264.000

Manufacturing Overhead-$ 230.000

Net Income$ 34.000

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