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Haas Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: Variable cost per unit: Manufacturing: Direct materials Direct labour Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses Required: 1. Compute the company's break-even point in units sold. Break-even unit sales $ $ $ units $ 20 12 During its first year of operations, Haas produced 50,000 units and sold 50,000 units. During its second year of operations, it produced 65,000 units and sold 40,000 units. In its third year, Haas produced 30,000 units and sold 55,000 units. The selling price of the company's product is $48 per unit. 3 1 $390,000 $210,000

Haas Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: Variable cost per unit: Manufacturing: Direct materials Direct labour Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses Required: 1. Compute the company's break-even point in units sold. Break-even unit sales $ $ $ units $ 20 12 During its first year of operations, Haas produced 50,000 units and sold 50,000 units. During its second year of operations, it produced 65,000 units and sold 40,000 units. In its third year, Haas produced 30,000 units and sold 55,000 units. The selling price of the company's product is $48 per unit. 3 1 $390,000 $210,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Haas Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: Variable cost per unit: Manufacturing: Direct materials Direct labour Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses Required: 1. Compute the company's break-even point in units sold. Break-even unit sales $ During its first year of operations, Haas produced 50,000 units and sold 50,000 units. During its second year of operations, it produced 65,000 units and sold 40,000 units. In its third year, Haas produced 30,000 units and sold 55,000 units. The selling price of the company's product is $48 per unit. units 20 12 3 1 $390,000 $210,000
Transcribed Image Text:Haas Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: Variable cost per unit: Manufacturing: Direct materials Direct labour Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expenses Required: 1. Compute the company's break-even point in units sold. Break-even unit sales $ During its first year of operations, Haas produced 50,000 units and sold 50,000 units. During its second year of operations, it produced 65,000 units and sold 40,000 units. In its third year, Haas produced 30,000 units and sold 55,000 units. The selling price of the company's product is $48 per unit. units 20 12 3 1 $390,000 $210,000
2. Assume the company uses variable costing: a. Compute unit product costs for Year 1, Year 2, and Year 3. Unit product cost Variable expenses: Total variable expenses b. Prepare an income statement for year 1, year 2, and year 3. Fixed expenses Year 1 Total fixed expenses. Net operating income (loss) Unit product cost Year 2 Year 1 Year 3 Net operating income (loss) Haas Company Variable Costing Income Statement Year 1 Year 2 0 0 Year 3 0 0 S 3. Assume the company uses absorption costing: a. Compute unit product costs for Year 1, Year 2, and Year 3. (Round your intermediate and final answers to 2 decimal places.) Year 2 Haas Company Absorption Costing Income Statement Year 1 0 0 0 0 0 $ b. Prepare an income statement for year 1, year 2, and year 3. (Round your intermediate calculations to 2 decimal places.) 0 $ Year 3 Year 2 0 0 0 0 $ Year 3 0 0.
Transcribed Image Text:2. Assume the company uses variable costing: a. Compute unit product costs for Year 1, Year 2, and Year 3. Unit product cost Variable expenses: Total variable expenses b. Prepare an income statement for year 1, year 2, and year 3. Fixed expenses Year 1 Total fixed expenses. Net operating income (loss) Unit product cost Year 2 Year 1 Year 3 Net operating income (loss) Haas Company Variable Costing Income Statement Year 1 Year 2 0 0 Year 3 0 0 S 3. Assume the company uses absorption costing: a. Compute unit product costs for Year 1, Year 2, and Year 3. (Round your intermediate and final answers to 2 decimal places.) Year 2 Haas Company Absorption Costing Income Statement Year 1 0 0 0 0 0 $ b. Prepare an income statement for year 1, year 2, and year 3. (Round your intermediate calculations to 2 decimal places.) 0 $ Year 3 Year 2 0 0 0 0 $ Year 3 0 0.
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