Question

Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs per unit over the relevant range of 53,000 to 93,000 units is given below Required: 1. Complete the above schedule of the company's total costs and costs per unit. 2. Assume that the company produces and sells 83,000 units during the year at a selling price of $9.98 per unit. Prepare a contribution format income statement for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the above schedule of the company's total costs and costs per unit. (Round the per unit variable cost and fixed cost to 2 decimal places.) Units Produced and Sold 53,000 73,000 93,000 $ 127,2001 480,000 607,200 S $ OS Total costs Variable costs Fixed costs Total costs Cost per unit: Variable cost Fixed cost Total cost per unit 2.401 2.40 s 0.00 $ 2.40 $ 2.40

Answer 1

Ans.1		Units produced and sold
		53,000	73000	93000
	Total costs:
	Variable costs	$127,200	$175,200	$223,200
	Fixed costs	$480,000	$480,000	$480,000
	Total costs	$607,200	$655,200	$703,200
	Cost per unit:
	Variable cost per unit	$2.40	$2.40	$2.40
	Fixed cost per unit	$9.06	$6.58	$5.16
	Total cost per unit	$11.46	$8.98	$7.56
	*Total fixed cost and Variable cost per unit remain constant on each level of activity.
	*Total cost per unit = Variable cost per unit + Fixed cost per unit
	Total variable cost =   Variable cost per unit * Number units produced and sold
	Units produced and sold	53,000	73000	93000
	Variable cost	$2.40 * 53,000	$2.40 * 73,000	$2.40 * 93,000
	*Fixed cost per unit = Total fixed cost / Number units produced and sold
	Units produced and sold	53,000	73000	93000
	Fixed cost	$480,000 / 53,000	$480,000 / 73,000	$480,000 / 93,000
Ans. 2	HARRIS COMPANY
	Contribution Margin Income Statement
	Particulars	Amount
	Sales (83,000 * $9.98)	$828,340
	Less: Variable cost (83,000 * $2.40)	-$199,200
	Contribution margin	$629,140
	Less: Fixed cost	-$480,000
	Income from operations	$149,140