2) Riverside Inc. makes one model of wooden canoe. Partial information for it fo

Question

2) Riverside Inc. makes one model of wooden canoe. Partial information for it follows: Number of Canoes Produced and Sold 540 620 720 Total costs Vartable costs Ftked costs $ 67.500 150,000 $217,500 Total costs Cost per un Vartable cost per unt Fbed cost per unt 2 Total cost per unlt Required: Prepare Riverside's contribution margin income statement for each independent scenario. 1. Riverside raises the sales price to $600 per canoe. 2. Both sales price and variable cost per unit increase by 10 percent 3. Riverside cuts its fixed cost by 20 percent.

Explanation / Answer

2) Schedule :

Note : for these indenpendent scenario sales quantity is not given

540 620 780 Total cost Variable cost 67500 77500 97500 Fixed cost 150000 150000 150000 Total cost 217500 227500 247500 Cost per unit Variable cost per unit 125 125 125 Fixed cost per unit 277.78 241.94 192.31 Total cost per unit 402.78 366.94 317.31

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