Question

The following information is given for XYZ, Corp and will be used to answer the next 7 questions

Sales price per unit                             $8.50

                                   

Direct labor per unit                           $1.90

Direct materials per unit                     $2.60

Variable overhead per unit                 $1.40

                                   

Factory overhead that does not change with volume $327,600

General and administrative expenses $194,000

Using the original variable and fixed costs, the graph of XYZ's total costs would show which of the following?

Question 35 options:

	Slope of the line is $5.90 per unit.
	A vertical line at the start and end of the relevant range
	A horizontal line for all levels of production
	The line crosses the Y axis at $590

Answer 1

Direct labor per unit	$         1.90
Direct materials per unit	$         2.60
Variable overhead per unit	$         1.40
Total variable cost	$         5.90
Slope of the line is  equal to total variable cost.
Slope of the line is $5.90 per unit.	correct