Mechem Corporation Produces and Sells a Single Product

question 127

Essay

Mechem Corporation produces and sells a single product. In April, the company sold 2,000 units. Its total sales were $148,000, its total variable expenses were $78,900, and its total fixed expenses were $55,800.Required: a. Construct the company's contribution format income statement for April. (Do not round intermediate calculations.)
b. Redo the company's contribution format income statement assuming that the company sells 1,900 units. (Do not round intermediate calculations.)

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Definitions:

Stock Ownership

Holding shares in a corporation, giving the shareholder a claim on part of the company's assets and earnings.

Price Appreciation

The increase in the value of an asset or security over time.

Expected to Pay

The anticipated amount of money that will be disbursed for liabilities, services, or goods acquired.

Require a Return

The expectation of financial gain on an investment, which can manifest as interest, dividend, or capital appreciation.