Question

operations: Stree years or 10 points Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses 5 $ S S 30 22 6 2 eBook $540,000 $ 240,000 Print During its first year of operations, Haas produced 60.000 units and sold 60.000 units During its second year of operations, it produced 75,000 units and sold 50,000 units. In its third year, Haas produced 40.000 units and sold 65,000 units. The selling price of the company's product is $73 per unit References Required: 1. Compute the company's break-even point in unit sales 2. Assume the company uses variable costing a Compute the unit product cost for Year 1. Year 2. and Year 3 b. Prepare an income statement for Year 1 Year 2, and Year 3 3. Assume the company uses absorption costing a. Compute the unit product cost for Year 1 Year 2. and Year 3. b. Prepare an income statement for Year 1 Year 2, and Year 3. Complete this question by entering your answers in the tabs below. Rea 1 Reg 2A Reg 28 Reg 2 Reg 3 Compute the company's break-even point in unit sales. Break-even unit sales 26.000 units Reg 2A >

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Answer 1

Requirement (3A) Requirement (1) Break Even in units Fixed Cost / Contribution margin per Unit 60000 Units Year 1 $ $ S $ Direct material Direct labour Variable MOH Fixed MOH Year 2 30.00 $ 22.00 $ $ 9.00 $ Year 3 30.00 $ 22.00 $ 6.00 $ 7.20 $ 30.00 22.00 6.00 13.50 780000 6.00 Fixed Costs : (540000+240000) Contribution margin per unit (73-30-22-6-2) 13 Unit Product Cost $ 67.00 $ 65.20 $ 71.50 Requirement (24) Direct material Direct labour Variable MOH Year 1 $ $ $ Year 2 30 $ 22 $ 6 $ Year 3 30 $ 22 $ 6 $ 30 22 6 Requirement (3B) Haas Company Absorption Costing Income statement Year 1 TYear 2 Year 3 Sales $ 4,380,000 $ 3,650,000 $ 4,745,000 Cost of goods sold $ 4,020,000 $ 3,260,000 $ 4,490,000 Gross Margin $ 360.000 $ 390,000 $ 255,000 Seling and administrative expense $ 360,000 $ 340,000 $ 370,000 Net Operating income $ $ 50,000 $ (115,000) Unit Product Cost $ 58 $ 58 $ 58 Note : Please comment down for any further clarifications Requirement (2B) Haas Company Variable Costing Income statement Year 1 Year 2 Year 3 Sales Revenue $ 4,380,000 $3,650,000 $4,745,000 Variable expense : Variable cost of goods sold $ 3,480,000 $2,900,000 $3,770,000 Variable seling and administrative expense $ 120,000 $ 100,000 $ 130,000 $ 3,600,000 $3,000,000 $3,900,000 $ 780,000 $ 650,000 $ 845,000 Total Variable expense Contribution margin Fixed expenses : Fixed Manufacturing overhead Fixed selling and administrative expense $ 540,000 $ 540,000 $ 540,000 $ 240,000 $ 240,000 $ 240,000 Total Fixed expense Net Operating Income (loss) $ 780,000 $ $ 780,000 $ 780,000 $ (130,000 $ 65,000