Answer:
Graph Picnic Time
Contribution Income Statement
For the Month of July
Sales $400,000
Less variable costs:
Direct materials $100,000
Direct labor 60,000
Manufacturing overhead 20,000
Selling and administrative 16,000
Total variable costs $196,000
Contribution margin $204,000
Less fixed cost:
Manufacturing overhead $36,000
Selling and administrative 68,000
Total fixed costs $104,000
Profit $100,000
Explanation:
a) Data and Calculations:
Selling price per picnic basket = $100
July Production and sales = 4,000 baskets
Variable Costs per Unit:
Manufacturing:
Direct materials $25
Direct labor 15
Manufacturing overhead 5
Total $45
Selling and administrative 4
Total $49
Fixed Costs per Month
Manufacturing overhead $36,000
Selling and administrative 68,000
Total $104,000
Contribution Income Statement
For the Month of July
Sales $400,000 ($100 * 4,000)
Less variable costs:
Direct materials $100,000 ($24 * 4,000)
Direct labor 60,000 ($15 * 4,000)
Manufacturing overhead 20,000 ($5 * 4,000)
Selling and administrative 16,000($4 * 4,000)
Total variable costs $196,000
Contribution margin $204,000
Less fixed cost:
Manufacturing overhead $36,000
Selling and administrative 68,000
Total fixed costs $104,000
Profit $100,000
