Fanelli Corporation, a merchandising company, reported the following results for July:
Cost of goods sold is a variable cost in this company.
Required:a. Prepare a traditional format income statement for July.b. Prepare a contribution format income statement for July.

Contribution Format

A type of income statement where costs are divided into variable and fixed categories, emphasizing the contribution margin.

Traditional Format

In accounting, a conventional way of presenting financial statements that may include the income statement in a single-step or multi-step format, depending on the level of detail.

Cost Of Goods Sold

This is the direct costs attributable to the production of the goods sold in a company, including the cost of the materials and labor directly used to create the product.