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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 | 20,800 |
| Units sold | 19,400 |
| Units in ending inventory | 1,400 |
| 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 | $ 728,000 |
| Fixed selling and administrative | 291,000 |
| Total fixed costs | $ 1,019,000 |
Required:
- Assume the company uses variable costing. Compute the unit product cost for one barbecue grill.
- Assume the company uses variable costing. Prepare a contribution format income statement for last year.
- How many barbecue grills must be sold to break even? Assume the company uses variable costing. Compute the unit product cost for one barbecue grill.
Assume the company uses variable costing. Prepare a contribution format income statement for last year.
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| | | Chuck Wagon Grills, Incorporated | | Variable Costing Income Statement | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
- How many barbecue grills must be sold to break even?
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