Riverside Inc. makes one model of wooden canoe. Partial information for it follo
ID: 2605320 • Letter: R
Question
Riverside Inc. makes one model of wooden canoe. Partial information for it follows Number of Canoes Produced and Sold 485 635 785 Total costs Variable costs Fixed costs $ 64,990 148,900 $213,890 Total costs Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit Required 1. Complete the table. (Round your cost per unit answers to 2 decimal places.) Number of Canoes Produced and Sold 485 635 785 Total Costs Variable Costs 64.990 Fixed Costs 148,900 Total Costs $ 213,890S 0 Cost per Unit Variable Cost per Unit Fixed Cost per Unit Total Cost per Unit 0.00 S 0.00 S 0.00Explanation / Answer
1.
Number of Canoes Produced and Sold
485
635
785
Total cost
Variable cost
$ 64,990
$ 85,090
$ 105,190
Fixed cost
$ 148,900
$ 148,900
$ 148,900
Total cost
$ 213,890
$ 233,990
$ 254,090
Cost per unit
Variable cost
$ 134
$ 134
$ 134
Fixed cost
$ 307.01
$ 234.49
$ 189.68
Total cost per unit
$ 441.01
$ 368.49
$ 323.68
2.
Sales price
$ 505
Less : Variable cost per unit
$ 134
Unit contribution margin
$ 371
Contribution margin ratio
73.47%
Contribution margin ratio = Unit contribution margin / Sales price
= $ 371/ $ 505
= 0.734653465 or 73.47 %
3.
RIVERSIDE INC.
Contribution Margin Income Statement
For Next Year
Sales Revenue ($ 505 x 835)
$ 421,675
Less: Variable Cost ($ 134 x 835)
$ 111,890
Contribution Margin ($ 371x 835)
$ 309,785
Less: Fixed Cost
$ 148,900
Net Operating Income
$ 160,885
Number of Canoes Produced and Sold
485
635
785
Total cost
Variable cost
$ 64,990
$ 85,090
$ 105,190
Fixed cost
$ 148,900
$ 148,900
$ 148,900
Total cost
$ 213,890
$ 233,990
$ 254,090
Cost per unit
Variable cost
$ 134
$ 134
$ 134
Fixed cost
$ 307.01
$ 234.49
$ 189.68
Total cost per unit
$ 441.01
$ 368.49
$ 323.68
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