you are planning a t shirt business. rent on new production facility is $5,000 p
ID: 1221209 • Letter: Y
Question
you are planning a t shirt business. rent on new production facility is $5,000 per month. insurance is $6,000 annually. each tshirt cost you $5 and an additional $3.00 for materials. you purchase your t-shirts by the pallet , which contains 1,000 in each. However if you purchase 2 pallets of t-shrts at a time, then you get a 10% discount. if you purchase 3 pallets of tshirts, then you get a 20% discount. construct a table of your cost a reflecting fixed and variable costs be careful of the details. Table has Quantities column (0-3), TFC column, TVC column, TC column, AVC column and MC column.
Quantity TFC TVC TC AVC MC 0 1 2 3Explanation / Answer
Annual rental cost = $ 5000X 12
Annual rental cost = $60,000
Annual insurance cost = $ 6,000
Total annual fixed cost = $ 66,000
Quantity TFC TVC TC AVC MC 0 $66,000 0 $66,000 0 1 $66,000 8000 $74,000 8 $8,000 2 $66,000 14400 $80,400 7.2 $6,400 3 $66,000 16800 $82,800 5.6 $2,400Related Questions
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