Question

Head-First Company plans to sell 5,000 bicycle helmets at $75 each in the coming year. Product cots 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:
1. Calculate the total variable cost per unit.
2. Calculate the total fixed expense for the year.
3. Prepare a contribution margin income statement for Head-First Company for the coming year.


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  • CreatedSeptember 22, 2015
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