Schonhardt Corporation\'s relevant range of activity is 3,100 units to 6,500 uni

Question

Schonhardt Corporation's relevant range of activity is 3,100 units to 6,500 units. When it produces and sells 4,800 units, its average costs per unit are as follows Average Cost per Unit $7.70 $3.10 Direct materials Direct labor Variable manufacturing overhead $1.75 Fixed manufacturing overhead Fixed selling expense Fixed administrative expense $3.00 $1.05 $0.75 $0.85 ales commissions Variable administrative expense $0.75 If 5,500 units are produced, the total amount of fixed manufacturing cost incurred is closest to

Explanation / Answer

Calculate Fixed manufacturing cost ;

Fixed manufacturing cost = 4800*3 = $14400

So answer is b) $14400

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