Question: chuck wagon grills inc makes a single producta handmade specialty...
Chuck Wagon Grills, Inc., makes a single product—a handmade specialty barbecue grill that it sells for $200. Data for last year’s operations follow:
|Units in beginning inventory||0|
|Units in ending inventory||800|
|Variable costs per unit:|
|Direct materials||$ 60|
|Variable manufacturing overhead||10|
|Variable selling and administrative||30|
|Total variable cost per unit||$ 120|
|Fixed manufacturing overhead||$||220,000|
|Fixed selling and administrative||500,000|
|Total fixed costs||$||720,000|
1.Assume that the company uses variable costing. Compute the unit product cost for one barbecue grill.
2. Assume that the company uses variable costing. Prepare a contribution format income statement for the year
3. What is the company’s break-even point in terms of the number of barbecue grills sold?