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 59,000 to 99,000 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 89,000 units during the year at a selling price of $11.10 per unit. Prepare a contribution format income statement for the year. Units Produced and Sold 59,000 79,000 99,000 Total costs: Variable cost $230,100 not attempted not attempted Fixed cost 490,000 not attempted not attempted Total costs $720,100 $0 $0 Cost per unit: Variable cost not attempted not attempted not attempted Fixed cost not attempted not attempted not attempted Total cost per unit $0.00 $0.00 $0.00 Harris Company Contribution Format Income Statement Salesselected answer correct not attempted Variable expensesselected answer correct not attempted Contribution marginselected answer correct not attempted Fixed expenseselected answer correct not attempted Net operating incomeselected answer correct not attempted
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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 59,000 to 99,000 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 89,000 units during the year at a selling price of $11.10 per unit. Prepare a contribution format income statement for the year.
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Variable cost is the cost which depends on the level of production.
Fixed cost is the cost which is fixed and does not change with the change in the level of production.
Contribution is the difference between sales and variable cost.
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