Problem
The Weezer company is a single product company. The following data is available for the month of March 2014.
Sale price per unit $30
Number of units manufactured and sold during the month 2,000
Variable manufacturing cost per unit $12
Variable selling and administrative cost per unit $4
Fixed manufacturing cost per month $6,000
Fixed marketing and administrative cost per month $2,000
Company does not maintain finished goods and work in process inventory.
Required: Prepare in good format, a traditional income statement and a contribution margin income statement.
Briefly discuss the difference uses of the traditional income statement and the contribution margin income statement.