Question

Number of units produced by Wilson Company in May 2,300 The accountants classified the total costs...

Number of units produced by Wilson Company in May 2,300
The accountants classified the total costs incurred in May in to two categories:
Fixed cost $53,200
Variable costs $64,400
Number of units budgeted to be produced in June 2,800
What is the expected cost per unit in the month of June?
Round your answer to 2 digits.
A.

$51.13
B.

$47.00
C.

$42.00
D.

$62.25
E.

$23.00
Business   Accounting   
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Homework Answers

Answer #1

Total fixed cost = $53,200

Total variable cost in May = $64,400

Number of units produced in May = 2,300

Variable cost per unit = Total variable cost in May/Number of units produced in May

= 64,400/2,300

= $28

Number of units produced in June = 2,800

Total variable cost in June = Variable cost per unit x Number of units produced in June

= 28 x 2,800

= $78,400

Total cost in JUne = Total variable cost in June + Total fixed cost

= 78,400 + 53,200

= $131,600

cost per unit in the month of June = Total cost in June/Number of units produced in June

= 131,600/2,800

= $47

Correct option is (B)

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