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QUESTION 5 Preparing a Contribution Format Income Statement

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QUESTION 5

Preparing a Contribution Format Income Statement. (LO – 3-1) Wheeler Corporation’s most recent income statement follows.

Total                       Per Unit
Sales (8,000 units)	$208,000	$26.00
Variable expenses	$144,000	18.00
Contribution margin	$64,000	$8.00
Fixed expenses	$56,000
Net Operating income	$8,000

Required:

Prepare a new Contribution format income statement under each of the following conditions (consider each case independently):

1. The sales volume increases by 50 units

2. The sales volume declines by 50 units.

3. The sales volume is 7,000 units.

10 points   

QUESTION 6

Computing Job Costs (LO – 4-3)
Weaver Company’s predetermined overhead rate is $18.00 per direct labor-hour and its direct labor wage rate is $12.00 per hour.  The following information pertains to Job A-200.

Direct Materials ………………………………. $200 Direct Labor …………………………………….. $120

Required:

1.    What is the total manufacturing cost assigned to Job a-200?

2.    If Job A-200 consists of 50 units, what is the average cost assigned to each unit included in the job?