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Head-First Company plans to sell 4,700 bicycle helmets at $75 each in the coming year. Product costs include:

Direct materials per helmet	$ 31
Direct labor per helmet	6.50
Variable factory overhead per helmet	2.75
Total fixed factory overhead	20,000

Variable selling expense is a commission of $3.00 per helmet; fixed selling and administrative expense totals $28,600.

	Required:
1.	Calculate the total variable cost per unit.
2.	Calculate the total fixed expense for the year.
3.	Prepare a contribution margin income statement for Head-First Company for the coming year.

Amount Descriptions

Refer to the list below for the exact wording of an amount description within your income statement.

Amount Descriptions
Operating income
Operating loss
Sales
Total contribution margin
Total fixed cost
Total variable cost

Cost Calculations

1. Calculate the total variable cost per unit. Round your answer to two decimal places.

Variable cost per unit

2. Calculate the total fixed expense for the year.

Total fixed expense for the year

Contribution Margin Income Statement

3. Prepare a contribution margin income statement for Head-First Company for the coming year. Refer to the list of Amount Descriptions for the exact wording of text items within your income statement. Round your per unit answers to two decimal places.

Head-First Company

Contribution Margin Income Statement

For the Coming Year

1		Total	Per Unit
2
3
4
5
6

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