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 57,000 to 97,000 units is given below:

Required:

1. Complete the schedule of the company’s total costs and costs per unit as given in the relevant tab below.

2. Assume that the company produces and sells 87,000 units during the year at a selling price of $8.68 per unit. Prepare a contribution format income statement for the year.

Complete this question by entering your answers in the tabs below.

Complete the schedule of the company’s total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.)

Complete this question by entering your answers in the tabs below. Complete the schedule of the company’s total costs and costs per unit as given in the relevant tab below. (Round the per unit variable cost and fixed cost to 2 decimal places.) Units Produced and Sold 57,000 77,000 97,000 Total costs: Variable costs $171,000 ** ** Fixed costs 360,000 ** ** Total costs $531,000 Cost per unit: Variable cost ** ** ** Fixed cost ** ** ** Total cost per unit Required 2 Assume that the company produces and sells 87,000 units during the year at a selling price of $8.68 per unit. Prepare a contribution format income statement for the year. Harris Company Contribution Format Income Statement Administrative expenses Beginning merchandise inventory Cost of goods sold Direct labor

Answer 1

1
	Units Produced and Sold
	57000	77000	97000
Total costs:
Variable costs	171000	231000	291000
Fixed costs	360000	360000	360000
Total costs	531000	591000	651000
Cost per unit
Variable cost	3.00	3.00	3.00
Fixed cost	6.32	4.68	3.71
Total cost per unit	9.32	7.68	6.71
2
Harris Company
Contribution Format Income Statement
Sales	755160	=87000*8.68
Variable expenses	261000	=87000*3.00
Contribution margin	494160
Fixed expenses	360000
Net operating income	134160