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 61,000 to 101,000 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 91,000 units during the year at a selling price of $9.86 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 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 61,000 81,000 101,000 Total costs: Variable costs $ Fixed costs 201,300 450,000 651,300 Total costs Cost per unit: Variable costſ Fixed cost Total cost per unit

Answer 1

Requirement 1

	Units produced and sold
	61000	81000	101000
Total costs:
Variable costs	$ 201,300	$ 267,300*	$ 333,300
Fixed costs	$ 450,000	$ 450,000	$ 450,000
Total costs:	$ 651,300	$ 717,300	$ 783,300
Cost per unit
Variable costs	$ 3.30	$ 3.30	$ 3.30
Fixed costs	$ 7.38	$ 5.56	$ 4.46
Total Cost per unit	$ 10.68	$ 8.86	$ 7.76

*267300=201300/61000*81000

Variable cost increase or decrease in proportion to increase or decrease in Units produced

Fixed cost remain same al all level of activity.

Requirement 2

Harris Company
Contribution margin income statement
Sales revenue	$ 897,260
Less: Variable cost (9.86 x 91000)	$ 300,300
Contribution margin	$ 596,960
Fixed cost	$ 450,000
Operating profit	$ 146,960