Answer:
Parker Company Manufacturers
Units Produced Sold
60,000 80,000 100,000
Total Costs
Variable Costs $ 150,000 $ 200,000 $ 250,000
Fixed Costs $ 360,000 $ 360,000 $ 360,000
Total Costs $ 510,000 $ 560,000 $ 610,000
Cost Per Unit
Variable Cost $ 2.50 2.50 2.50
Fixed Cost $ 6.0 4.5 3.60
Total Cost $ 8.5 7.0 6.10
Parker Company Manufacturers
Income Statement
Sales ( 100,000 @ 6.10) (assuming CP= SP) $ 610,000
Less Variable Expenses
(100,000 @ 2.5) $ 250,000
Contribution Margin $ 360,000
Less Fixed Expenses $ 360,000
Net Income