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Required information Skip to question [The following information applies to the questions displayed below.] Chuck Wagon Grills, Incorporated, makes a barbecue grill it sells for

Required information

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[The following information applies to the questions displayed below.]

Chuck Wagon Grills, Incorporated, makes a barbecue grill it sells for $210. Data for last years operations follow:

Units in beginning inventory 0
Units produced 20,000
Units sold 19,000
Units in ending inventory 1,000
Variable costs per unit:
Direct materials $ 50
Direct labor 80
Variable manufacturing overhead 20
Variable selling and administrative 10
Total variable cost per unit $ 160
Fixed costs:
Fixed manufacturing overhead $ 700,000
Fixed selling and administrative 285,000
Total fixed costs $ 985,000

Required:

  1. Assume the company uses variable costing. Compute the unit product cost for one barbecue grill.
  2. Assume the company uses variable costing. Prepare a contribution format income statement for last year.
  3. How many barbecue grills must be sold to break even?

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