Question

The Janesky Company has collected data on the manufacture of 3,186 robot grippers last month. The breakdown of total costs is shown below. They now need to plan for future months.

Units sold last month	3,186
Direct materials	$108,929
Direct labor	$230,317
Manufacturing variable overhead	$116,761
Selling and administrative costs	$240,933

1. What was the total cost per unit?

2. What was the variable cost per unit?

3. Janesky is forecasting that 8,875 units will be produced and sold without any increase in fixed costs in the coming month. What would be the total cost based on last months cost data?

4. What would be the break even price to produce and sell 4,335 units in the coming month?

Please provide the excel formulas

Answer 1

1) You can see the formula in the top in the formula bar.

2) Selling and administrative costs are the only fixed cost, so they will be excluded from this variable cost.

3)

4) Break even price would be the price at which sales would be equal to total costs. So, first we compute the total costs at 4335 units -

Now, divide the above total costs by the no. of units -