YOUR Company plans to sell 1,000 bikes at $400 each in the coming year.

Product costs include:

Direct materials per bike $180

Direct labour per bike $100

Variable factory overhead per bike $25

Total fixed factory overhead $15,000

There is a variable selling expense for commission of $20 per bike.

Fixed selling and administrative expense totals $30,000.

1.Calculate the total variable expense per unit.

2.Calculate the total fixed expense for the year.

3.Calculate the unit contribution margin.

4.Prepare a contribution margin income statement for the coming year.

Answer rating: 100% (QA)

1 Total variable expense per unit Total variable expense per unit can be calculated by summing up the direct materials per bike direct labor per bike ... View the full answer