QUESTION 2
| 30,000 units | 45,000 units |
Variable Costs | $135,000 | ??? |
Fixed Costs | $25,000 | ??? |
Mixed Costs | $16,000 | ??? |
Total Costs | $176,000 | $246,500 |
Total mixed costs at 45,000 units would be
$202,500. |
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$246,500. |
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$19,000. |
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unknown. |
QUESTION 6
Mario Company has total fixed costs of $570,000. Total fixed and variable costs are $622,500 at a production level of 205,000 units. The fixed cost per unit at a production level of 300,000 units is
$2.78 |
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$3.04 |
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$2.08 |
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$1.90 |
Variable costs per unit is constant and Fixed costs in total is constant.
Variable costs per unit = $135,000 / 30,000 = $4.5
30,000 units | 45,000 units | |
Variable costs | $135,000 | $202,500 (45,000*$4.5) |
Fixed costs | $25,000 | $25,000 |
Mixed costs | $16,000 | $19,000 (plug) |
Total costs | $176,000 | $246,500 |
The answer is $19,000.
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Fixed costs remains constant in total.
Total fixed costs at production level of 300,000 units = $570,000
The fixed cost per unit at a production level of 30,000 units = $570,000 / 300,000 units
= $1.9
The answer is $1.90.
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