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    CompuDesk, Inc.

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

    Units 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

    1. Assume the company uses variable costing. Compute the unit cost for one computer desk.

    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 units sold?

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    https://brainmass.com/business/financial-ratios/compudesk-inc-215128

    Solution Preview

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

    Units 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 ...

    $2.19

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