Milden Company is a merchandiser that plans to sell 12,000 units during the next quarter at a selling price of $100 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost Formula
Cost of good sold $35 per unit sold
Advertising expense $210,000 per quarter
Sales commissions 6% of sales
Shipping expense $28,000 per quarter + $9.10 per unit sold
Administrative salaries $145,000 per quarter
Insurance expense $9,000 per quarter
Depreciation expense $76,000 per quarter

Required:
a. Prepare a contribution format income statement for the next quarter.
b. Prepare a traditional format income statement for the next quarter.