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 54,000 to 94,000 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 84,000 units during the year at a selling price of $10.26 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 54,000 74,000 94,000 $ 135,000 500,000 635,000 $ $ 0 $ 0 Total costs: Variable costs Fixed costs Total costs Cost per unit: Variable cost Fixed cost Total cost per unit $ 0.00 $ 0.00 $ 0.00

Answer 1

Requirement 1

	Units produced and sold
	54000	74000	94000
Total costs:
Variable costs	$ 135,000	$ 185,000*	$ 235,000
Fixed costs	$ 500,000	$ 500,000	$ 500,000
Total costs:	$ 635,000	$ 685,000	$ 735,000
Cost per unit
Variable costs	$ 2.50	$ 2.50	$ 2.50
Fixed costs	$ 9.26	$ 6.76	$ 5.32
Total Cost per unit	$ 11.76	$ 9.26	$ 7.82

*185000=135000/54000 x 74000

Fixed cost in total remains same.

Requirement 2

Harris Company
Contribution margin income statement
Sales revenue	$ 861,840
Less: Variable cost (2.50 x 84000)	$ 210,000
Contribution margin	$ 651,840
Fixed cost	$ 500,000
Operating profit	$ 151,840