6-18 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO6-1, LO6-2] Haas Company manufactures and sells one product. The following information pertains to each of the company's first three years of operations: 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 $ 24 $ 16 $ 7 $ 2 $ 120,000 $ 60,000 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 $52 per unit. 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. Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 28 Req 3A Req 38 Compute the company's break-even point in unit sales. Break-even unit sales units Answer is not complete. Complete this question by entering your answers in the tabs below.) Req 1 Req 2A Req 28 Req 3A Req 38 Compute the unit product cost for Year 1, Year 2, and Year 3. Assume the company uses variable costing. Year 1 Year 2 Year 3 Unit product cost 47 47 47 < Req 1 Req 2B > Req 1 Req 2A Req 28 Req 3A Req 38 Prepare an income statement for Year 1, Year 2, and Year 3. Assume the company uses variable costing. Haas Company Variable Costing Income Statement Year 1 Year 2 Year 3 $ Sales Variable expenses: Indirect materials 3,120,000 2,600,000 3,380,000 120,000 1,560,000 Indirect labor 960,000 800,000 1,040,000 Variable cost of goods sold 60,000 50,000 65,000 Variable selling and administrative 60,000 50,000 65,000 Total variable expenses 1,200,000 900,000 2,730,000 Contribution margin 1,920,000 1,700,000 650,000 Fixed expenses: Fixed manufacturing overhead 120,000 120,000 120,000 Fixed selling and administrative 60,000 60,000 60,000 Variable expenses: Indirect materials 120,000 1,560,000 Indirect labor 960,000 800,000 1,040,000 Variable cost of goods sold 60,000 ( 50,000 65,000 Variable selling and administrative 60,000 50,000 65,000 Total variable expenses 1,200,000 900,000 2,730,000 Contribution margin 1,920,000 1,700,000 650,000 Fixed expenses: Fixed manufacturing overhead 120,000 120,000 120,000 Fixed selling and administrative 60,000 60,000 60,000 Total fixed expenses 180,000 180,000 180,000 $ Net operating income (loss) 1,740,000 1,520,000 $470,000 < Req 2A Req 3A > Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 3A Req 38 R Compute the unit product cost for Year 1, Year 2, and Year 3. Assume the company uses absorption costing. (Round yc intermediate calculations and final answers to 2 decimal places.) Year 1 Unit product cost $ 49.00 ( Year 2 $ 48.60 Year 3 $50.00 < Req 2B Req 3B > Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 28 Req 3A Req 38 Prepare an income statement for Year 1, Year 2, and Year 3. Assume the company uses absorption costing. (Round your intermediate calculations to 2 decimal places.) Haas Company Absorption Costing Income Statement Year 1 Year 2 Year 3 Sales 3,120,000 2,600,000 $ 3,380,000 ( Cost of goods sold 2,940,000 2,430,000 3,250,000 Gross margin 180,000 170,000 Selling and administrative expenses 180,000 230,000 130,000 190,000 Net operating income (loss) $ 0 $ (60,000) $ (60,000) < Req 3A Req 38