Okay, I understand your calculations...but in the first place
why are you calculating the net income using the contribution
approach..I have done some calculations and got the same answer
using the absorption approach..So what do you recommend? Am i
missing out something or calculating in a wrong way? Please advise.
Sales (110,000*5) = 550,000 - COGS (100,000* 0.25 + 110,000*1)=
135,000 Gross margin = 415,000 - Operating expenses ( 110,000*2 +
100,000* 0.65)= 285,000 Net Income= 130,000
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