CompuDesk, Inc., makes an oak desk specially designed for personal computers.

CompuDesk, Inc., makes an oak desk specially designed for personal computers. The desk sells for $200. Data for last year’s operations follow:

Units in beginning inventory		0
Units produced		10,000
Units sold		9,000
Units in ending inventory		1,000
Variable costs per unit:
Direct materials		$  60
Direct labor		30
Variable manufacturing overhead		10
Variable selling and administrative		20
Total variable cost per unit		$ 120
Fixed costs:
Fixed manufacturing overhead	$	300,000
Fixed selling and administrative		450,000
Total fixed costs	$	750,000

Required:

1.	Assume that the company uses variable costing. Compute the unit product cost for one computer desk. (Omit the "$" sign in your response.)

Unit product cost

$ 100

2.	Assume that the company uses variable costing. 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.)

Variable Costing Income Statement
Sales		$ 1,800,000
Variable expenses:
Variable cost of goods sold	$
Variable selling and administrative expenses		1,080,000
Contribution margin		720,000
Fixed expenses:
Fixed selling and administrative expenses
Fixed manufacturing overhead		750,000
Net operating income (loss)		$ -30,000

3.	What is the company’s break-even point in terms of units sold?

Break-even point

n/r

units