Practice_Mid_Term1

Prepare an income statement for fast track inc for

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Unformatted text preview: ncome statement for Fast Track Inc. for the year ended December 31st, 2009 (please ignore income tax). (15 points) 4 B. Prepare a statement of shareholders equity for Fast Track Inc. for the year ended December 31st, 2009. (5 points) C. Suppose Fast Track Inc. is currently considering opening another branch. Is the information in the income statement enough for helping the company to make the decision of expansion? Why or Why not? Please provide answer on page 6, which is intentionally left blank. (5 points) 5 Q u es t i o n 3 : (a) What is the difference between fixed cost and variable cost? Provide three examples each for fixed and variable cost and explain why those costs are fixed or variable. (15 points) (b) Whitman Corporation, a merchandising company, reported sales of 7,400 units for May 2011 at a selling price of $677 per unit. The cost of goods sold (all variable) was $441 per unit and the variable selling expense was $54 per unit. The total fixed selling expense was $155,600. The variable administrative expense was $24 per unit and the total fixed administrative expense was $370,400. Prepare a contribution format income statement for September 2011 and be sure to include the contribution margin in the statement (10 points). 6...
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This note was uploaded on 11/01/2013 for the course BUS 70-122 taught by Professor Sunez during the Fall '11 term at Carnegie Mellon.

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