The following costs result from the production and sale of 4,500 drum sets manufactured by Tom Thompson Company for the year ended December 31, 2013. The drum sets sell for $300 each. The company has a 35% income tax rate.
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| Variable production costs |
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| Plastic for casing |
$ |
121,500 |
| Wages of assembly workers |
|
414,000 |
| Drum stands |
|
162,000 |
| Variable selling costs |
|
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| Sales commissions |
|
112,500 |
| Fixed manufacturing costs |
|
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| Taxes on factory |
|
15,000 |
| Factory maintenance |
|
30,000 |
| Factory machinery depreciation |
|
90,000 |
| Fixed selling and administrative costs |
|
|
| Lease of equipment for sales staff |
|
30,000 |
| Accounting staff salaries |
|
80,000 |
| Administrative management salaries |
|
160,000 |
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| 1. |
Prepare a contribution margin income statement for the company.
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| 2.1 |
Compute its contribution margin per unit. |