Question: Head-First Company plans to sell 5,000 bicycle helmets at $70 each in the coming year. Unit variable cost is $49 (includes direct materials, direct labor,

Head-First Company plans to sell 5,000 bicycle helmets at $70 each in the coming year. Unit variable cost is $49 (includes direct materials, direct labor, variable overhead, and variable selling expense). Total fixed cost equals $29,400 (includes fixed factory overhead and fixed selling and administrative expense).

Required:

1. Calculate the number of helmets Head-First must sell to earn operating income of $81,900.

2. Check your answer by preparing a contribution margin income statement based on the number of units calculated.

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