Riverside Inc makes one model of wooden canoe Partial inform

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 0.00

Solution

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