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 69,000 to 109,000 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 99,000 units during the year at a selling price of $8.21 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 69,000 89,000 109,000 Total costs: Variable cost Fixed cost 179,400 410,000 589,400 Total costs Cost per unit: Variable cost Fixed cost Total cost per unit

Answer 1

1.

	Units Produced and Sold
	69,000	89,000	109,000
Total costs:
Variable cost	179,400	89,000 x 2.6 = 231,400	109,000 x 2.6 = 283,400
Fixed cost	410,000	410,000	410,000
Total Costs:	589,000	641,400	693,400
Cost per unit:
Variable cost	179,400/69,000 = $2.6	231,400/89,000 = $2.6	283,400/109,000 = $2.6
Fixed cost	410,000/69,000 = $5.94	410000/89,000 =4.61	410,000/109,000 =3.76
Total cost per unit	$8.54	$7.21	$6.36

2.

Harris Company
Contribution Format Income Statement
Sales ( 99,000 x 8.21)	812,790
Variable cost ( 99,000 x 2.6)	257,400
Contribution Margin	$555,390
Fixed cost	-410,000
Net operating profit	$145,390

Variable cost per unit does not change at different output lends. Total fixed cost also does not change due to change in output.

Variable cost per unit = Total variable cost / Number of units

Total variable cost = Variable cost per unit x Number of units

Fixed cost per unit = Total fixed cost / Number of units

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