Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Exercise 6-14 Variable Costing Unit Product Cost and Income Statement; Break-Even [LO6-1, LO6-2] Chuck Wagon Grills, Inc., makes a single producta handmade specialty barbecue grill

Exercise 6-14 Variable Costing Unit Product Cost and Income Statement; Break-Even [LO6-1, LO6-2]

Chuck Wagon Grills, Inc., makes a single producta handmade specialty barbecue grill that it sells for $200. Data for last years operations follow:

Units in beginning inventory 0
Units produced 10,200
Units sold 8,600
Units in ending inventory 1,600
Variable costs per unit:
Direct materials $ 80
Direct labor 40
Variable manufacturing overhead 10
Variable selling and administrative 30
Total variable cost per unit $ 160
Fixed costs:
Fixed manufacturing overhead $ 240,000
Fixed selling and administrative 100,000
Total fixed costs $ 340,000

Required:
1.

Assume that the company uses variable costing. Compute the unit product cost for one barbecue grill.

2.

Assume that the company uses variable costing. Prepare a contribution format income statement for the year.

3. What is the companys break-even point in terms of the number of barbecue grills sold?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions

Question

Compare and contrast the housing patterns of different cultures

Answered: 1 week ago

Question

Compare and contrast high- and low-load environments

Answered: 1 week ago

Question

Describe why intercultural communication competence is a necessity

Answered: 1 week ago