Kubin Company\'s relevant range of production is 17,000 to 26,500 units. When it

Question

Kubin Company's relevant range of production is 17,000 to 26,500 units. When it produces and sells 21,750 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Amount per Unit $7.80 $ 4.80 $ 2.30 $5.80 $ 4.30 $ 3.30 $ 1.80 1.30 Required: 1. If 17,000 units are produced and sold, what is the variable cost per unit produced and sold? 2. If 26,500 units are produced and sold, what is the variable cost per unit produced and sold? 3. If 17,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold? 4. If 26,500 units are produced and sold, what is the total amount of variable cost related to the units produced and sold? 5. If 17,000 units are produced, what is the average fixed manufacturing cost per unit produced? 6. If 26,500 units are produced, what is the average fixed manufacturing cost per unit produced? 7. If 17,000 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production? 8. If 26,500 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.)

Explanation / Answer

1 Variable cost per unit 18 (7.8+4.8+2.3+1.8+1.3) 2 Variable cost per unit 18 (7.8+4.8+2.3+1.8+1.3) 3 Total amount of variable cost 306000 (17000*18) 4 Total amount of variable cost 477000 (26500*18) 5 Average fixed manufacturing cost per unit 7.42 (21750*5.8)/17000 6 Average fixed manufacturing cost per unit 4.76 (21750*5.8)/26500 7 Total amount of fixed manufacturing overhead cost 126150 8 Total amount of fixed manufacturing overhead cost 126150

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