Required information

Use the following information for the Exercise below. $($Algo$)$

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

Barnes Company reports the following for its product for its first year of operations.

Direct materials

$ $36$ per unit

Direct labor $$26$ per unit

Variable overhead $ $$12$ per unit

Fixed overhead $$70,000$ per year

Variable selling and administrative expenses

$$3$ per unit

Fixed selling and administrative expenses

$$28,000$ per year

Exercise $6-6($Algo$)$ Computing contribution margin at different production levels LO P$2$

The company sells its product for $$140$ per unit. Compute contribution margin using variable costing assuming the

company $($a$)$ produces and sells $2,800$ units and $(b)$ produces $3,500$ units and sells $2,800$ units.