Question

Harris Company manufactures and sells a single product. A partially completed schedule of the company's total costs and costs pe unit over the relevant range of 52,000 to 92,000 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 82,000 units during the year at a selling price of $9.93 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 52,000 72,000 92,000 Total costs Variable costs Fixed costs $ 161,200 420,000 581,200 $ $ 0 $ 0 Total costs Cost per unit: Variable cost Fixed cost Total cost per unit $ 0.00 $ 0.00 $ 0.00

Answer 1

Units produced and Sold
	52,000	72,000	92,000
Total costs:
Variable costs	$161,200	$223,200 [72,000 units x $3.10 per unit]	$285,200 [92,000 units x $3.10 per unit]
Fixed costs	$420,000	$420,000 [Doesn't change]	$420,000 [Doesn't change]
Total costs:	$581,200	$643,200	$705,200
Cost per unit
Variable costs	$3.10 [$161,200 / 52,000 units[	$3.10	$3.10
Fixed costs	$8.08 [$420,000 / 52,000 units]	$5.83 [$420,000 / 72,000 units]	$4.57 [$420,000 / 92,000 units]
Total cost per unit	$11.18 [$3.10 + $8.08]	$8.93 [$3.10 + $5.83]	$7.67 [$3.10 + $4.57]

.

.

Harris Company
Contribution Margin Income Statement
Sales                           [Units sold x Selling price per unit = 82,000 units x $9.93 per unit]	$814,260
Variable expenses      [Units sold x Variable cost per unit = 82,000 units x $3.10 per unit]	$254,200
Contribution margin      [Sales - Variable expenses = $814,260 - $254,200]	$560,060
Fixed expenses [Doesn't change]	$420,000
Net operating income     [Contribution margin - Fixed expenses = $560,060 - $420,000]	$140,060