Question

At an activity level of 5,900 units, Hass Corporation's total vaiable cost is $347,982 and its...

At an activity level of 5,900 units, Hass Corporation's total vaiable cost is $347,982 and its total fixt cost is $284,321.

For the activity level of 6,100 units, compute a: the total variable cost,

b: the total fixed cost,

c:the total cost,

d: the average variable cost per unit,

e: the average fixed cost per unit

f: the average total cost per unit.

Assume that this activity level is within the relevant range.

Homework Answers

Answer #1

a) Total variable cost: 359,778

b) Total fixed cost: 284,321

c) Total cost: 644,099

d) Average variable cost per unit: $58.98

e) Average fixed cost per unit: $46.61

f) Average total cost per unit: $105.59

 

Working:

Variable cost = $347,982 / 5,900 units = $58.98 per unit

Total variable cost: 6100 units * 58.98 = 359,778

Total fixed cost: 284,321

Total cost: Total variable cost + Total fixed cost = 359,778 + :284,321 = 644,099

Average fixed cost per unit: 284,321/ 6400 units = 46.61

Total cost per unit: Average variable cost per unit: $58.98 + Average fixed cost per unit: $46.61 = $105.59

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