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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
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: SASASASA 22 14 2753 $270,000 $210,000 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 units sold. Fixed manufacturing overhead Fixed selling and administrative expenses 2. Assume the company uses variable costing: a. Compute unit product costs for Year 1, Year 2, and Year 3. Year 1 Year 2 Year 3 Unit product cost b. Prepare an income statement for year 1, year 2, and year 3. Variable expenses: Total variable expenses Fixed expenses: Haas Company Variable Costing Income Statement Year 1 Year 2 Year 3 0 0 0 0 0 0 0 0 0 Total fixed expenses: Net operating income (loss) 0 $ 0 $ 0
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