Instructions

$3.$

Head$-$First Company plans to sell $5,000$ bicycle helmets at $$75$ each in the coming year. Product costs include:

Direct materials per helmet: $$30$

Direct labor per helmet: $8$

Variable factory overhead per helmet: $4$

Total fixed factory overhead: $20,000$

Variable selling expense is a commission of $$3$ per helmet; fixed selling and administrative expense totals $$29,500.$

Required:

Prepare a contribution margin income statement for Head$-$First Company for the coming year.