Grange Manufacturing Company had net income of $300,000 in 2017 when the selling price per unit was $200 and data for variable and fixed costs were as follows:

Cost Schedule:

Variable Costs:

Direct Material

$28

Direct Labour

$35

Variable Manufacturing Overhead

$17

$80

Fixed Costs:

Manufacturing Overhead

$225,000

Advertising

45,000

Administrative

150,000

$420,000

Required:

i) Compute the number of units sold in 2017, using the equation method.

ii) Using the sales units calculated in (i), prepare a contribution margin income statement for the year ended December 31, 2017, detailing the components of total fixed costs, and clearly showing contribution and net income.