Find the company total variable cost per unit

Reference no: EM132601535

Fixed and Variable Cost

Stuart Manufacturing produces metal picture frames. The company's income statements for the last two years are given below:

Last year This year

Units sold. 50,000 70,000

Sales $800,000 $1,120,000

Cost of goods sold 550,000 710,000

Gross margin 250,000 410,000

Selling and administrative expense 150,000 190,000

Net operating income $100,000 $ 220,000

The company has no beginning or ending inventories.

Required:

Question 1: Estimate the company's total variable cost per unit and its total fixed costs per year. (Remember that this is a manufacturing firm.)

Question 2: Compute the company's contribution margin for this year.

Reference no: EM132601535

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