Dayton, Inc. manufactured 15,000 units of product last month and identified the

Question

Dayton, Inc. manufactured 15,000 units of product last month and identified the following costs associated with the manufacturing activity:

Required:

Unit variable costs and total fixed costs are expected to remain unchanged next month. Calculate the unit cost and the total cost if 21,000 units are produced next month. (Round "Unit costs" to 2 decimal places.)

Variable costs: Direct materials used $ 1,044,000 Direct labor 2,011,000 Indirect materials and supplies 230,000 Power to run plant equipment 212,000 Fixed costs: Supervisory salaries 937,000 Plant utilities (other than power to run plant equipment) 291,000 Depreciation on plant and equipment (straight-line, time basis) 141,000 Property taxes on building 200,000

Explanation / Answer

Unit variable costs = (1044000+2011000+230000+212000)/15000= 233.1333 Total variable costs 4895800 =21000*233.1333 Total fixed costs 1569000 Total costs 6464800 Unit costs 307.85 =6464800/21000

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