Question

The following information is available for Masun Company: Sales $550,000 Total fixed expenses $150,000 Cost of goods sold 390,000 Total variable expenses $370,000 A CVP income statement would report:

Answer 1

$180,000

Explanation:

The computation of CVP income statement is shown below:-

CVP Income statement

Sales $550,000

Variable cost $370,000

Contribution margin $180,000

Fixed cost $150,000

Operating Profit $50,000

Therefore for computing the contribution margin we simply deduct the variable cost from sales and fixed cost to arrive the operating profit