In: Accounting
Cost Behavior
SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = $584,685 + $1.42X, where X equals number of smokers. Last year, SmokeCity produced 21,300 smokers. Actual overhead costs for the year were as expected.
Required:
2. What is the total overhead cost incurred by SmokeCity last year?
$
3. What is the total fixed overhead cost incurred by SmokeCity last year?
$
4. What is the total variable overhead cost incurred by SmokeCity last year?
$
For questions 5-7, round your answers to the nearest cent. Use those rounded figures in subsequent computations, if necessary.
5. What is the overhead cost per unit produced?
$ per unit
6. What is the fixed overhead cost per unit?
$ per unit
7. What is the variable overhead cost per unit?
$ per unit
8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 21,000 units and (b) 22,800 units. Round your answers to the nearest cent.
21,000 Units | 22,800 Units | |
---|---|---|
Unit cost | $ | $ |
Unit fixed cost | ||
Unit variable cost |