Parker Company manufactures and sells a single product.

Parker Company manufactures and sells a single product.

Required:

1.

A partially completed schedule of the company's total and per unit costs over a relevant range of 60,000 to 100,000 units produced and sold each year is given below. Complete the schedule of the company's total and unit costs. (Round the "Cost per unit" to 2 decimal places. Omit the "$" sign in your response.)

		Units Produced and Sold
		60,000	80,000	100,000
Total costs:
Variable costs		$ 150,000	$	$
Fixed costs		360,000
Total costs		$ 510,000	$	$
Cost per unit:
Variable cost		$	$	$
Fixed cost
Total cost per unit		$	$	$

2.

Assume that the company produces and sells 90,000 units during the year at the selling price of $7.50 per unit. Prepare a contribution format income statement for the year. (Input all amounts as positive values except losses which should be indicated by a minus sign. Omit the "$" sign in your response.)

Parker Company Contribution Format Income Statement
Sales	$
Variable expenses
Contribution margin
Fixed expenses
Net operating income	$

Explanation:

1.

The company's variable cost per unit would be:

$150,000	= $2.50 per unit.
60,000 units

2.

Sales (90,000 units × $7.50 per unit) = $675,000

Variable expenses (90,000 units × $2.50 per unit) = $225,000