• 100% Satisfaction Guarantee

Linda_us, Finance, Accounts & Homework Tutor
Category: Homework
Satisfied Customers: 7044
Experience:  Post Graduate Diploma in Management (MBA)
19873544
Linda_us is online now

# High-Low Method; Contribution format income statement Alden

### Resolved Question:

High-Low Method; Contribution format income statement

"Alden company has decided to use a contribution format income statement for internal planning purposes.
The company has analyzed its expenses and has developed the following cost formulas:"

Cost Cost Formula
Cost of goods sold \$20 per unit sold
Sales commission 5% of sales
Shipping expense ?
Depreciation expense 50,000 per quarter

"Management has concluded that shipping expense is a mixed cost, containing both variable and fixed cost elements.
Units sold and the remaining shipping expense over the last 8 quarters are given below:"

Quarter Units Sold
Year1:
...First 16000
...Second 18000
...Third 23000
...Fourth 19000
Year2:
...First 17000
...Second 20000
...Third 25000
...Fourth 22000

"Management would like a cost formula derived for shipping expense so that a budgeted contribution format income
statement can be prepared for the next quarter. "

1. Using the high-low method, estimate a cost formula for shipping expense.

"2. In the first quarter of year 3, the company plans to sell 21,000 units at the selling price of \$50 per unit. Prepare
a Contribution Format Income Statement for the quarter"
Submitted: 2 years ago.
Category: Homework
Expert:  Linda_us replied 2 years ago.

Regards

Linda
Customer: replied 2 years ago.
About 1/2 hour. Use this version because I missed a column in the previous one. thanks

High-Low Method; Contribution format income statement

"Alden company has decided to use a contribution format income statement for internal planning purposes.
The company has analyzed its expenses and has developed the following cost formulas:"

Cost Cost Formula
Cost of goods sold \$20 per unit sold
Sales commission 5% of sales
Shipping expense ?
Depreciation expense 50,000 per quarter

"Management has concluded that shipping expense is a mixed cost, containing both variable and fixed cost elements.
Units sold and the remaining shipping expense over the last 8 quarters are given below:"

Quarter Units Sold Shipping Expense
Year1:
...First 16000 160000
...Second 18000 175000
...Third 23000 217000
...Fourth 19000 180000
Year2:
...First 17000 170000
...Second 20000 185000
...Third 25000 232000
...Fourth 22000 208000

"Management would like a cost formula derived for shipping expense so that a budgeted contribution format income
statement can be prepared for the next quarter. "

1. Using the high-low method, estimate a cost formula for shipping expense.

"2. In the first quarter of year 3, the company plans to sell 21,000 units at the selling price of \$50 per unit. Prepare
a Contribution Format Income Statement for the quarter"
Expert:  Linda_us replied 2 years ago.
I am working on it. I will upload the solution soon.

Regards

Linda
Customer: replied 2 years ago.
thanks
Expert:  Linda_us replied 2 years ago.
You can view this answer by clicking here to Register or Login and paying \$3.
Linda_us, Finance, Accounts & Homework Tutor
Category: Homework
Satisfied Customers: 7044
Experience: Post Graduate Diploma in Management (MBA)

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

### What Customers are Saying:

• Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
< Last | Next >
• Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
• This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
• Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
• I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin Kernersville, NC
• Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther Woodstock, NY
• Thank you so much for taking your time and knowledge to support my concerns. Not only did you answer my questions, you even took it a step further with replying with more pertinent information I needed to know. Robin Elkton, Maryland
• He answered my question promptly and gave me accurate, detailed information. If all of your experts are half as good, you have a great thing going here. Diane Dallas, TX

• ### Manal Elkhoshkhany

#### Satisfied Customers:

4520
More than 5000 online tutoring sessions.
< Last | Next >

### Manal Elkhoshkhany

#### Satisfied Customers:

4520
More than 5000 online tutoring sessions.

### Linda_us

#### Satisfied Customers:

3121
Post Graduate Diploma in Management (MBA)

### LogicPro

#### Satisfied Customers:

3035
Expert in Java C++ C C# VB Javascript Design SQL HTML

### Lani S.

#### Satisfied Customers:

2457
Registered Nurse, Internet Researcher, Private Tutor

### Chris M.

#### Satisfied Customers:

2341
Master's Degree, strong math and writing skills, experience in one-on-one tutoring (college English)

### F. Naz

#### Satisfied Customers:

1975
Experience with chartered accountancy

### Bizhelp

#### Satisfied Customers:

1873
Bachelors Degree and CPA with Accounting work experience