Question

Required: 1. A partially completed schedule of the company's total and per unit costs over the relevant range of 63,000 to 103,000 units produced and sold annually is given below: Complete the schedule of the company's total and unit costs. (Round the variable cost and fixed cost to 2 decimal places.) Units Produced and Sol 63,000 83,000 103,000 Total costs: Variable costs $ 252,000 370,000 Fixed costs 370,000 370,000 $ 622,000 370,000370,000 Total costs Cost per unit Variable cost Fixed cost Total cost per unit 0.00 $ 0.00 S 0.00

Answer 1

	Units Produced
	63,000	83,000	1,03,000
Total Costs:
Variable Costs	$ 252,000	$ 332,000	$ 412,000
Fixed Costs	$ 370,000	$ 370,000	$ 370,000
Total Costs:	$ 622,000	$ 702,000	$ 782,000
Cost per Unit:
Variable Cost	$ 4.00	$ 4.00	$ 4.00
Fixed Cost	$ 5.87	$ 4.46	$ 3.59
Total Cost per unit	$ 9.87	$ 8.46	$ 7.59
Notes to Schedule:
Variable Cost per unit = Total variable Costs ÷ Units produce
V.C per unit = $252,000 ÷ 63,000 = $ 4 per unit at each level of output
Fixed Cost per unit= Total Fixed Cost ÷ Level of output
F.C per unit at 63,000 of output = $370,000 ÷ 63,000 = $ 5.87 per unit
F.C per unit at 83,000 of output = $370,000 ÷ 83,000 = $ 4.46 per unit
F.C per unit at 103,000 of output = $370,000 ÷ 103,000 = $ 3.59 per unit

Harris Company
Contribution Format Income Statement
Sales Revenue (93,000 units @ $9.46 per unit)	$ 879,780
Less: Variable Costs: (93,000 units @ $4 per unit)	$ 372,000
Contribution Margin	$ 507,780
Less: Fixed Costs	$ 370,000
Operating Income/Profit	$ 137,780
Fixed Cost per unit= Total Fixed Cost ÷ Level of output
At 93,000 level of Output= $370,000 ÷ 93,000 = $3.98 per unit