Question

Help V & DRIE SUD Check my work 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 62,000 to 102,000 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 92.000 units during the year at a selling price of $8.73 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 cos 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 62,000 $2,000 102,000 s 192.2001 380,000 572,200 $ $ 0 $ 0 Total costs: Variable cost Fixed cost Total costs Cost per unit Variable cost Fixed cost Total cost per unit $ 0.00 $ 0.00 $ 0.00 < Prev 2 of 4 !!! Next >

Answer 1

Solution to Part 1
Harris Company
	Amount in $
	Units Produced and Sold
	62000	82000	102000
Total Costs:
Variable Cost	192200	254200	316200
Fixed Cost	380000	380000	380000
Total Costs	572200	634200	696200
Cost Per Unit:
Variable Cost	3.1	3.1	3.1
Fixed Cost	6.13	4.63	3.73
Total Cost Per Unit	9.23	7.73	6.83
Solution to Part 2
Preparation of Contribution Margin Income Statement when company produces and sells 92000 units at selling price of $ 8.73 per unit.
Contribution Margin Income Statement of Harris Company
Particulars	Amount in $
Sales (92000 units @ 8.73/ unit)	803160
Less:
Variable Cost (92000 units @ $ 3.1/ unit)	285200
Contribution Margin	517960
Less:
Fixed Costs	380000
Net Income	137960
Notes:
1. Since, the Fixed cost remain constant irrespective of sales/ production volution, therefore, the Fixed costs at all levels will be $ 380000 and fixed cost per unit will change as per the production/ sales level.
2. Since the variable cost per unit remain constant, therefore total variable cost at each production / sales level will change accordingly.
3. Fixed Cost Per unit	=	380000/ No. of Units produced/ sold
4. Total Variable Cost	=	$ 3.1 * No. of Units produced/ sold