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Problem
Riverside Inc. makes one model of wooden canoe. Partial information for it follows:
Number of Canoes Produced and Sold
400
600
750
Total costs
Variable costs
52,000
78,000
97,500
Fixed costs
180,000
232,000
258,000
277,500
Cost per unit
Variable cost per unit
130.00
Fixed cost per unit
450.00
300.00
240.00
Total cost per unit
580.00
430.00
370.00
Riverside sells its canoes for $660 each. Next year Riverside expects to sell 1,000 canoes.
Required:
Complete the Riverside's contribution margin income statement for each independent scenario. Assuming each scenario is a variation of Riverside's original data.
Scenerio 1 Rises Sales Price to $760 per canoeScenerio 2 Increases Sales Price and Variable Cost per Unit by 10%Scenerio 3 Decrese Fixed Cost by 20%.
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