In: Accounting
Kubin Company’s relevant range of production is 13,000 to 18,000 units. When it produces and sells 15,500 units, its average costs per unit are as follows: Amount per Unit Direct materials $ 7.40 Direct labor $ 4.40 Variable manufacturing overhead $ 1.90 Fixed manufacturing overhead $ 5.40 Fixed selling expense $ 3.90 Fixed administrative expense $ 2.90 Sales commissions $ 1.40 Variable administrative expense $ 0.90 Required: 1. If 13,000 units are produced and sold, what is the variable cost per unit produced and sold? 2. If 18,000 units are produced and sold, what is the variable cost per unit produced and sold? 3. If 13,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold? 4. If 18,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold? 5. If 13,000 units are produced, what is the average fixed manufacturing cost per unit produced? 6. If 18,000 units are produced, what is the average fixed manufacturing cost per unit produced? 7. If 13,000 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production? 8. If 18,000 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production? (Round per unit values to 2 decimal places.)
1 | ||
Direct materials | 7.40 | |
Direct labor | 4.40 | |
Variable manufacturing overhead | 1.90 | |
Sales commissions | 1.40 | |
Variable administrative expense | 0.90 | |
Variable cost per unit produced and sold | 16.00 | |
2 | ||
Direct materials | 7.40 | |
Direct labor | 4.40 | |
Variable manufacturing overhead | 1.90 | |
Sales commissions | 1.40 | |
Variable administrative expense | 0.90 | |
Variable cost per unit produced and sold | 16.00 | |
3 | ||
Unit produced and sold | 13000 | |
X Variable cost per unit | 16.00 | |
Total amount of variable cost | 208000 | |
4 | ||
Unit produced and sold | 18000 | |
X Variable cost per unit | 16.00 | |
Total amount of variable cost | 288000 | |
5 | ||
Fixed manufacturing costs | 83700 | =15500*5.40 |
Divide by units | 13000 | |
Average fixed manufacturing cost per unit | 6.44 | |
6 | ||
Fixed manufacturing costs | 83700 | =15500*5.40 |
Divide by units | 18000 | |
Average fixed manufacturing cost per unit | 4.65 | |
7 | ||
Total amount of fixed manufacturing overhead | 83700 | =15500*5.40 |
8 | ||
Total amount of fixed manufacturing overhead | 83700 | =15500*5.40 |